R&D Tax Incentive

Research & Development

R&D Tax Incentive

The R&D Tax Incentive is an Australian Government initiative designed to encourage innovation in Australia, by providing financial assistance in the form of tax offsets to companies who engage in eligible research and development activities. It is jointly administered by AusIndustry (on behalf of Innovation Australia) and the ATO.

Are you eligible?
A simple question with a not so simple answer! The eligibility criteria is complex and an interview process with our R&D team is the best way to sort through the jargon. An hour of your time will allow us to do an initial analysis of your company’s investment into new areas of innovation and business growth. Often companies are not aware that their funded process improvements or software development may be eligible for the R&D tax incentive. That’s why a meet and greet with us is an excellent opportunity to find out what is covered under the scheme and how you can benefit.
Who can claim Research & Development incentive?

If you are an Australian company for income tax purposes, are generating new knowledge through the development of new or improved materials, products, processes or services, and are spending greater than $20,000 on eligible research & development expenditure you could be eligible.

Does your project / Business qualify ?

 

The best way to assess your eligibility is to meet with us as the definition and scope of eligible activities is both large and diverse. Eligible business investments can include improvements and/or developments in products and processes to improve performance, useability and efficiency and better service external clients.

Often companies are not aware that their funded process improvements or software development activities may be eligible for the R&D tax incentive. Improvements to your company’s environmental footprint may also be considered.

Also included are projects across every day industries which offer a wide range of products and services such as Information & Communication Technology, Manufacturing, Biotechnology, Consumer Products, and Agriculture.

 

Example of eligible Projects

 

Examples of research and development projects could include:

  • A new application that is able to predict the interests of event attendees based on GPS movement tracking technology and suggest networking meetings based on these interests.
  • New headphones that are able to significantly improve sound isolation and provide a greater frequency range for quality and clarity of sound.
  • New technology and processes used in automobile part manufacturing that are able to significantly reduce costs and improve energy efficiency without compromising performance.
  • A new roofing material and design that is able to withstand extreme weather conditions and provide better insulation.An eCommerce website solution that provides the end user with a unique buying capability that simplifies the item selection and payment processing methods currently used.

 

How much can I claim under R&D incentive ?

 

The Research & Development Tax Incentive provides a reward to your company for investing in innovation in the form of tax offsets or a cash rebate. There are two components of the scheme:

  • Eligible R&D entities with an aggregated turnover of $20 million or less can access the 43.5% refundable tax offset, unless they are controlled by tax exempt entities;
  • Eligible R&D entities with an aggregated turnover of $20 million or greater can access the 38.5% refundable tax offset.

 

What does this R&D Incentive mean to you?

 

Q:  My company has an aggregated turnover of $20 million or less & is in a tax loss position.

A:: Your eligible to receive up to 43.5% of every dollar spent on R&D as a cash refund

Q:  My company has an aggregated turnover of $20 million or less & is in a tax profit position
A::  15% of every dollar spent on R&D will be credited against any tax liabilities.

Q:  My company has an aggregated turnover of $20 million or greater and is in a tax profit or tax loss position
A::  10% of every dollar spent on R&D  will be credited against any tax liabilities

 

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