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1 Is the acquisition date of the shares in Company A, for the purposes of the Income Tax Assessment Act 1997 (ITAA 1997), equivalent to the deferred taxing point of the ESS interest as determined by section 83A-125 of the ITAA 1997, rather than the date the shares were issued?

Yes Question 2 Is the cost base of the shares the market value of the shares on the date of deferred taxing point, pursuant to section 83A-125 of the ITAA 1997? Answer Yes Question 3 As of XX XX 202U, would the shares in Company A have been held for at least 12 months as required to meet the conditions in subsection 115-25(1) of the ITAA 1997? Answer Yes This ruling applies for the following periods : Income year ended 30 June 2023 Income year ended 30 June 2025 Income year ended 30 June 2026 The scheme commenced on: 1 July 2019

1.      This private ruling is based on the facts and circumstances and description of the scheme set out below, including taxpayer provided documents, or relevant parts of them: 2.         The taxpayer is a resident of Australia. 3.         Company A was incorporated on XX XX 20XX. 4.         Company A is a wholly owned subsidiary of Company B. 5.         Company A offered Restricted Share Unit Awards (RSUAs) on XX XX 202X to eligible participants. 6.         The taxpayer is an employee of Company A. 7.         The taxpayer has been a director of Company A since 201X and a director of Company B since 201Y. 8.         The taxpayer was offered YYY,YYY RSUAs on XX XX 202X for nil consideration. 9.         The taxpayer participated in the RSUA schemes at no cost 10.      The taxpayer did not pay any consideration on the vesting of the RSUAs or the issuance of ordinary shares in respect of the RSUAs. 11.      The RSUAs had a market value greater than nil on issue. 12.      The start-up rules in section 83A-33 will not apply. 13.      The predominant business of Company A is not the acquisition, sale or holding of shares, securities or other investments.

14.      The RSUAs or the associated ordinary shares that were issued did not result in the taxpayer holding more than 10% beneficial interest or control of 10% of the voting power in Company A. 202X RSUAs 15.      The minutes of the board meeting of Company A held on XX XX 202X states the number of RSUAs issued to the taxpayer in 202X. 16.      The Grant Notice of XX XX 202X provided the Vesting Schedule which stated that the RSUAs were subject to the following Performance Conditions: •                     50% will vest once the Company's ARR meets or exceeds $YYYYYY. •                     50% will vest once the Company's ARR meets or exceeds $ZZZZZZ. 17.      Company A achieved an ARR of $YYYYYY on XX XX 202V. 18.      Company A achieved an ARR of $ZZZZZZ on XX XX 202W. 19.      The Grant Notice provided that shares will be issued on the first business day after the 202X Vesting Date per the Vesting Schedule. 20.      There was a requirement for the taxpayer to remain continuously employed, engaged as director or provide consulting services until the Performance Conditions were met.

21.      The 202X RSUAs are automatically vested on satisfaction of the respective Performance Condition and Employment Condition. Share Issue 22.      Due to various administrative delays and complications, Company A issued XXXXXX ordinary shares to the taxpayer on XX XX 202U. 23.      The shares are held on capital account and not as trading stock. Post XX XX 202U 24.      The taxpayer together with the other shareholders exchanged shares in Company A for shares in Company B on XX XX 202U and obtained the rollover relief under subdivision 124-M ITAA 1997. 25.      Company A is now a fully owned subsidiary of Company B. 26.      The taxpayer together with the other shareholders intend to sell the Company B shares to a third party in early 202T. 27.      It is anticipated that the taxpayer will make a capital gain on the disposal of the Company B shares. Applicable Conditions Performance Conditions 28.      50% of the 202X RSUAs were to vest on Company A achieving an ARR of $YYYYYY (First Tranche). Company A achieved this ARR on XX XX 202V. The First Tranche vested on XX XX 202V.

29.      The balance 50% of the 2022 RSUAs were to vest on Company A achieving an ARR of $ZZZZZZ (Second Tranche). Company A achieved this ARR on XX XX 202X. The Second Tranche vested on XX XX 202X. 30.      The vesting of RSUAs was contingent on the Performance Conditions being met. The RSUAs would have lapsed if the Performance Conditions were not satisfied. Employment Condition 31.      The 202X RSUAs were subject to an employment condition. Transfer Restrictions 32.      The 202X RSUAs were subject to restrictions on transfer. Issue Date 33.    the Ordinary Shares in relation to RSUAs would not be issued until 3 years after vesting date and only if participant was still an employee, director or consultant of the Company or Subsidiary. 34.    However, the Issuance Schedule of the Grant Notice for the 202X RSUA's states:

Subject to any change on a Reorganisation of Capital, one Ordinary Share will be issued to the Participant on the first business day after the Vesting Date for each RSU that vests in accordance with the Vesting Schedule, provided the Participant remains continuously employed, engaged as a director, or provides consulting services to the Company on the Vesting Date. The issuance date will be treated as that business day, even if the actual share entry or delivery happens later due to admin delays. In any case, shares will be delivered no later than 30 June of the financial year in which the Vesting Date occurs. To the extent of any inconsistency between this Issuance Schedule and the Award Agreement, this Issuance Schedule will govern.

Income Tax Assessment Act 1997 subsection 83A-10(1) Income Tax Assessment Act 1997 subsection 83A-10(2) Income Tax Assessment Act 1997 subsection 83A-20(1) Income Tax Assessment Act 1997 section 83A-45 Income Tax Assessment Act 1997 section 83A-105 Income Tax Assessment Act 1997 subsection 83A-120(4) Income Tax Assessment Act 1997 subsection 83A-120(6) Income Tax Assessment Act 1997 subsection 83A-120(7) Income Tax Assessment Act 1997 section 83A-125 Income Tax Assessment Act 1997 Subdivision 83A-C Income Tax Assessment Act 1997 subsection 115-25(1) Income Tax Assessment Act 1997 section 115-30 Does IVA apply to this private ruling? Part IVA of the Income Tax Assessment Act 1936 contains anti-avoidance rules that can apply in certain circumstances where you or another taxpayer obtains a ta

Issue 1 Question 1 Is the acquisition date of the shares in Company A, for the purposes of the Income Tax Assessment Act 1997 (ITAA 1997), equivalent to the deferred taxing point of the ESS interest as determined by section 83A-125 of the ITAA 1997, rather than the date the shares were issued? Summary Yes. The acquisition date of the shares in Company A will be the deferred taxing point, section 83A-125. Detailed reasoning 1.         Employee share scheme (ESS) are schemes under which ESS interests in a company are provided to employees or associates, in relation to the employee's employment, subsection 83A-10(2). 2.         An ESS interest in a company is a beneficial interest in a share in the company or a right to acquire a beneficial interest in a share in the company, subsection 83A-10(1). 3.         The 2019 Equity Incentive Plan is an 'employee share scheme' as defined in subsection 83A-10(2), as it is a scheme under which ESS interests in a company are provided to employees, or associates of employees, of the company, or a subsidiary of the company, in relation to the employee's employment (subsection 83A-10(2)).

4.         The Commissioner considers the RSUAs are a right to acquire a beneficial interest in a share in Company A. 5.         Subdivision 83A-B applies where you acquire an interest under an ESS at a discount, subsection 83A-20(1). Subdivision 83A-C applies, and not Subdivision 83A-B, where the conditions to that subsection are met, Subsection 83A-105(1). Subdivision 83A-B applies by default where Subdivision 83A-C doesn't apply. 6.         Very broadly, Subdivision 83A-C gives deferred tax treatment to ESS interests where the employee is prevented from disposing them, and other conditions are met. 7.         Subdivision 83A-C will apply deferred tax treatment to beneficial interest in a right to acquire a beneficial interest in a share where: (a)          Subdivision 83A-B would (apart from section 83A-105) apply to the scheme, paragraph 83A-105(1)(a); (b)          After applying section 83A-315, there's still a discount given in relation to the interest, paragraph 83A-105(1)(aa); (c)           Section 83A-33, about start-ups, does not reduce the amount to be included in your assessable income, paragraph 83A-105(1)(ab);

(d)          Subsections 83A-45(1), (2), (3), and (6) apply to the interest, paragraph 83A-105(1)(b); and (e)          Subsection 83A-105(3) or (6) apply to the interest, paragraph 83A-105(1)(d). Acquired at a discount 8.         The RSUAs had a market value greater than nil on issue, under either the general concept or the regulations, such that the ESS interests will be issued at a discount after applying section 83A-315. 9.         The start-up rules in section 83A-33 will not apply. 10.      The taxpayer was employed by Company A when the RSUAs were granted, such that section 83A-45(1) is satisfied. 11.      The RSUAs relate to the acquisition of ordinary shares, such that section 83A-45(2) is satisfied. 12.      As the predominant business of Company A is not the acquisition, sale or holding of shares, securities or other investments, such that section 83A-45(3) is satisfied. 13.      The RSUAs or the associated ordinary shares that were issued did not result in the taxpayer holding more than 10% beneficial interest or control of 10% of the voting power in Company A, such that 83A-45(6) is satisfied.

14.      ESS interests that are beneficial interests in a right to shares need to meet either the real risk of forfeiture condition, 83A-105(3), or the genuine disposal restriction, 83A-105(6) for the deferred tax treatment to apply. Real Risk of Forfeiture 15.      Subsection 83A-105(3) will apply to an ESS interest that is a beneficial interest in a right to acquire a beneficial interest in a share, if when you acquire the interest: (a)          there is a real risk that, under the conditions of the scheme, you will forfeit or lose the ESS interest (other than by disposing of it, exercising the right or letting the right lapse); or (b)          there is a real risk that, under the conditions of the scheme, if you exercise the right, you will forfeit or lose the beneficial interest in the share (other than by disposing of it). 16.      ATO Interpretative Decision ATO ID 2010/61 Income Tax: Employee share scheme: real risk of forfeiture - minimum term of employment and good leaver provisions (ATO ID 2010/61) and web guidance at ESS - Real risk of forfeiture QC 27240 provides is some guidance on the requirement about a real risk of forfeiture.

17.      An ESS interest acquired by an employee is at real risk of forfeiture if a reasonable person would consider that there is a real risk that the employee may forfeit or lose the ESS interest, other than by intentionally taking no action to realise the benefit. 18.      The meaning of 'real' is something more than a mere possibility. An ESS interest will not be at real risk of forfeiture if a reasonable person would disregard the risk as highly unlikely to occur or as nothing more than a rare eventuality or possibility. 19.      An ESS may provide (at the time of grant) for ESS interests to be forfeited if the employee does not complete a minimum term of employment (forfeiture period). 20.      We accept that there will be a real risk of forfeiture where: •                     the minimum term of employment is at least six months, and the maximum deferral is no more than three years; or •                     where the minimum term of employment is at least 12 months. 21.      For ESS interests acquired outside these parameters, we will consider all the facts and circumstances to determine whether they are at a real risk of forfeiture.

22.      The 202X RSUA's were subject to Performance Conditions and did not vest until those Performance Conditions were met. The Performance Conditions were satisfied and the RSUAs vested for the First Tranche on XX XX 202V and the performance condition for the Second Tranche were satisfied on XX XX 202W. 23.      In addition, pursuant to the Issuance Schedule of the Grant Notice for the 202X RSUA's, the Ordinary Shares in relation to the RSUAs would not be issued until the first business day after the vesting date for each RSU and only if the participant was still an employee, director or consultant of the Company or a Subsidiary on vesting date. 24.      Therefore, there was a real risk of forfeiture of the 202X RSUAs until XX XX 202V for the First Tranche and until XX XX 202U for the Second Tranche. 25.      As the 202X RSUAs meet the real risk of forfeiture condition and the relevant conditions in section 83A-105(1), Subdivision 83A-C will apply. Deferred Taxing Point 26.      Section 83A-120 sets out the deferred taxing point for a right to acquire shares.

27.      Ordinarily, the deferred taxing point for a right to acquire shares is the earliest of the times in accordance with subsections 83A-120(4), (6) and (7) of the ITAA 1997, summarised as follows: •                     when the ESS interest has not been exercised, there is no real risk of forfeiting the ESS interest, and the scheme no longer genuinely restricts disposal of the ESS interest, subsection 83A-120(4); or •                     the end of the 15-year period starting when the employee acquired the ESS interest, subsection 83A-120(6); or •                     when the ESS interest is exercised and there is no real risk of forfeiting the share and the scheme no longer genuinely restricts the disposal of the share, subsection 83A-120(7). Genuinely Restricted from Disposal 28.      For the purposes of Division 83A, the term 'genuinely restricted' is not defined and therefore takes on its ordinary meaning. The term is discussed in Taxation Determination 2022/4 Income tax: when are you genuinely restricted from immediately disposing of an interest provided under an employee share scheme

? (TD 2022/4). TD 2022/4 sets out the Commissioner's view for determining when a scheme's disposal restrictions were genuine disposal restrictions and when a taxpayer would no longer be 'genuinely restricted' by the scheme for the purposes of determining the deferred taxing point. 29.      Paragraph 21 of TD 2022/4 states that in order for a genuine disposal restriction to occur, the scheme's restriction must control or limit the power or right to (voluntarily or compulsorily) sell, transfer, assign, deal with, make over or part with the ESS interest (whether legally or beneficially).

30.      Paragraphs 28 to 30 of TD 2022/4 further state that a scheme's genuine disposal restrictions may operate for either a fixed or variable periods of time. The period of time can be determined by many ways, including the vesting conditions, internal share trading policies, insider trading prohibitions or by any other means listed under the Corporations Act 2001. The genuine disposal restrictions will no longer be restrictive at the commencement of the first date of which there is an opportunity to dispose of the ESS interest by way of sale, transfer or gift even if they are lifted only temporarily. Deferred Taxing Point - 202X RSUAs 31.      As discussed above, the 202X RSUAs vested on XX XX 202V for the First Tranche and XX XX 202S for the Second Tranche. There was a real risk of forfeiture for the 202X RSUAs until those vesting dates. 32.      Per the Issuance Schedule on the Grant Notice for the 202X RSUAs, the taxpayer was then eligible to be issued with one Ordinary Share for each vested RSUA, provided they were still an employee, director or consultant of the Company on the vesting date.

33.      Effectively, the RSUAs are automatically exercised on XX XX 202V for the First Tranche and XX XX 202W when the shares could be issued. 34.      Once the shares were issued, in accordance with clause 5 of the Agreement, the Participant was free to assign, hypothecate, donate, encumber or otherwise dispose of any interests in the shares. 35.      For the 202X RSUAs, the shares were issued on XX XX 202U. 36.      The Issuance Schedule for the 202X RSUAs outlined that the taxpayer was eligible and had a right to be issued the shares from the first business date after the vesting date of the RSUAs, being XX XX 202V for the First Trance and XX XX 202W for the Second Tranche, and on those dates would have been eligible to deal with the shares as they wished. 37.      Further, the Issuance for the 202X RSUAs outline that the issuance date would be treated as the first business date after vesting date, even if the actual share entry or delivery happens later due to admin delays.

38.      The Commissioner accepts in respect of the 202X RSUAs and the associated shares, there was no risk of forfeiture from XX XX 202V for the First Tranche and XX XX 202W for the Second Tranche, and no disposal restrictions from XX XX 202V for the First Tranche and XX XX 202W for the Second Tranche. 39.      Therefore, the deferred taxing point for the 2022 RSUAs will be XX XX 202V for the First Tranche and XX XX 202W for the Second Tranche as per subsection 83A-120(6). Acquisition Date 40.      Subdivision 130-D operates to recognise that Division 83A contains the primary rules for taxing gains on ESS interests acquired under employee share schemes and that capital gains and capital losses on such interests should usually be disregarded during the period in which Division 83A applies to them. 41.      In particular subsection 130-80(1) operates to disregard any capital gain or capital loss to the extent it results from a CGT event if: (a)          the CGT event happens in relation to an ESS interest you acquire under an employee share scheme; and (b)          the CGT event is not CGT event E4, G1 or K8; and ... (d)          If Subdivision 83A-C applies to the interest

(i)            the time of the acquisition is the time when the CGT event happens; or (ii)           the CGT event happens on or before the ESS deferred taxing point for the interest. 42.      As Subdivision 83A-C applies to the acquisition of RSUAs, the effect of subsection 130-80(1) of the ITAA 1997 is to disregard the capital gain or capital loss from CGT events that happen from the time of acquisition up until the deferred taxing point. 43.      For an ESS interest subject to Subdivision 83A-C, section 83A-125 treats the acquisition date of an ESS interest (and the share or right of which it forms part) to be immediately after the deferred taxing point occurs for the ESS interest. Effectively, the ESS interest is taken to have been immediately re-acquired after the deferred taxing point. 44.      Therefore, pursuant to 83A-125, the acquisition date for the shares issued to the taxpayer will be as follows: •                     202X RSUAs - First Tranche, will have an acquisition date of XX XX 202V •                     2022 RSUAs - Second Tranche, will have an acquisition date of XX XX 202W.

45.      Further, section 83A-125 of the ITAA 1997 will operate to reset the cost base of the share acquired on exercise of the RSUA at the market value at the deferred taxing point. Question 2 Is the cost base of the shares the market value of the shares on the date of deferred taxing point, pursuant to section 83A-125 of the ITAA 1997? Summary Yes, the cost base of the shares will be the market value of the shares on the date of the deferred taxing point. For the 202X RSUAs - First Tranche, this will be the market value on XX XX 202V. For the 202X RSUAs - Second Tranche, this will be the market value on XX XX 202W. Detailed reasoning 46.      See discussion at Question 1, particularly paragraphs 43 to 45. Question 3 As of XX XX 202T, would the shares in Company B have been held for at least 12 months as required to meet the conditions in subsection 115-25(1) of the ITAA 1997? Summary Yes, the shares in Company B issued to the taxpayer will have been held for at least 12 months as of XX XX 202T. Detailed reasoning 47.      Generally, where a CGT asset has been owned by a taxpayer for at least 12 months, a discount capital gain is available. 48.      Subsection 115-25(1) provides:

To be a discount capital gain, the capital gain must result from a CGT event happening to a CGT asset that was acquired by the entity making the capital gain at least 12 months before the CGT event. 49.      The 12-month ownership period for discount capital gains in s 115-25 will start at the acquisition date determined under the 83A-125, ie the deferred taxing point. 50.      In XX XX 202U, the taxpayer exchanged their Company A shares to Company B shares under a Subdivision 124-M of the ITAA 1997 rollover. 51.      Where Subdivision 124-M roll-over relief is obtained, the replacement shares, for the purposes of the CGT discount under Div 115 is deemed to have been acquired at the time that the original interest was acquired, item 2 of section 115-30. 52.      Therefore, as of XX XX 202T, the Company B shares held by the taxpayer, received in exchange for their Company A shares acquired under the 202X RSUA will have been held for at least 12 months.