GQHC and Commissioner of Taxation (Taxation)

This matter concerned an appeal by GQHC against a decision by the Commissioner of Taxation. The dispute centred on whether certain activities undertaken by GQHC, specifically in relation to the farming of livestock and crops, constituted eligible research and development (R&D) activities under the *Industry Research and Development Act 1986* (Cth) and the *Income Tax Assessment Act 1997* (Cth). The Commissioner had determined that these activities were not core R&D activities, and GQHC sought to challenge this determination. The case was heard by Dominique K Grigg SM in the Administrative Appeals Tribunal.

The primary legal issues before the Tribunal were whether the activities undertaken by GQHC qualified as "core R&D activities" as defined by the relevant legislation, and whether these activities could be considered "experimental." This involved an examination of the meaning of "hypothesis" in the context of R&D and whether the claimed activities were genuinely experimental in nature. The Tribunal also considered a request by GQHC to adduce late evidence and whether a feedstock adjustment under section 355-465 of the *Income Tax Assessment Act 1997* was applicable.

The Tribunal's reasoning focused on the statutory definitions and objects of the R&D tax incentive legislation. It noted that the Board of Innovation and Science Australia has the discretion to make findings about whether activities are core or supporting R&D activities, but is not obligated to do so. The Tribunal considered expert evidence regarding the transformation of feed within broiler chickens and the production of eggs, and whether this process involved the generation of new knowledge or the creation of new or improved products, processes, techniques, or services. The Tribunal ultimately affirmed the Commissioner's decision, finding that the activities did not meet the criteria for eligible R&D. The Tribunal also refused GQHC's request to adduce late evidence, citing concerns about procedural fairness, delay, and costs, and noting that GQHC had been put on notice about potential issues with its evidence well in advance of the hearing.