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How Valuable is Australia’s Refundable R&D Tax Offset on a Global Scale?

February 29th, 2016

Ultimately, investing in research and development (R&D) is key to increasing innovation, productivity and competitive advantage. It is not only beneficial for businesses, but is also advantageous for the economy of our country. In fact, for many multinational companies, Australia has become the centre of their global R&D activities. This is primarily due to a highly skilled workforce, suitable infrastructure and a favourable R&D tax incentive program.

Australia’s R&D Tax Incentive, which has replaced the R&D Tax Concession since the 1st of July 2011, offers research and development tax offsets designed to encourage more companies to engage in R&D. The incentive was implemented to boost innovation at a time when companies were struggling to access capital. In particular cases, it offers a 43.5 percent refundable tax offset for R&D expenses in the form of annual cash rebates to companies that have less than $20 million in revenue and file tax returns in the country. Thus, for a research-intensive company, the tax benefit is a welcomed non-dilutive source of funding for R&D activities.

Previously, we’ve compared government support for business R&D in Australia, China, Canada, United Kingdom, United States and India. The infographic of this comparison can be found here. Alternatively, you can download the pdf here: R&D Incentives Around The Globe . In addition, Australia’s cash back schemes tops OECD comparison. However only a handful of countries (viewed in the table below) offer refundable tax offsets and Australia’s refundable tax offset is the most favourable in parallel to other countries.

Source: Deloitte 2013 Global Survey of R&D Tax Incentives

In accordance with the table above, Australia’s R&D Incentive program is indeed quite auspicious when compared on a global scale. Ultimately, the driving force behind the R&D Tax Incentive is to inspire more companies to engage in R&D in Australia. And it’s working: a number of companies have overtly stated that they have set up in Australia because of the support provided by the R&D Tax Incentive. The international benchmarking of Global R&D Tax Schemes within this post highlights that the Australian R&D tax incentive system is relatively competitive with international regimes.

However, as we’ve mentioned earlier, the type of offset differs depending on the turnover of the company and the amount of R&D expenditure incurred. Nonetheless, the R&D tax incentive remains one of the most reputable sources of funding and support for businesses in the research, development and early developmental commercialisation phases. Overall, Australia’s R&D tax incentive programme has become well regarded internationally and, combined with the recent decline in the Australian dollar, has been a driver of overseas investment in Australian R&D.

Please contact one of Swanson Reed’s Specialist R&D Tax Advisors if you are interested in learning more about the R&D incentive and what this can mean for your business.

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   Daniel McGregor  
 11. August, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  I have been using Swanson Reed for my clients for more than a decade.  Having a specialist firm that can provide practical and commercial advice that produces real outcomes is very important and we have received great feedback from our clients. Highly recommended.
  
 
 
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   Rueben Rajasingam  
 6. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Experienced responsive Team. They have been a great help to me and my company navigate the R&D tax claim process and have provided invaluable advice.
  
 
 
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   Enrique Esquivel  
 6. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian and the team at Swanson Reed have been extremely helpfully and professional during all of our consultations. Highly recommended.
  
 
 
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   Jess at Y&C  
 3. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  
  
 
 
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   Anatole Kononewsky  
 2. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  The Swanson Reed team have provided our company with exceptional professional advice and assistance for all of our R&D claims for many years - have always achieved great results with excellent value for their services.
  
 
 
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   Payam Toloo  
 2. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian Smyth and his team are very helpful, supportive and experts in their field of R&D Tax claims. I'm always happy with the work they do and been a customer of their for over 5 years.
  
 
 
      Posted on Google  
   
   Melissa Doddy  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  The Team at Swanson Reed are very experienced R&D Tax Advisors and gave us ongoing support with all of our R&D Claims, the consultants ensured we were always working with current legislative guidelines, gave us assistance with compiling technical and government documentation and went out their way to ensure they were with us for the entire process from beginning to end.  Highly recommended to anyone who needs assistance with working through what can at times be a daunting process.
  
 
 
      Posted on Google  
   
   Gary Watson  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  We can highly recommend Swanson and Reed as an R & D accountant. We have worked with them for several years now as they make our R & D claim so easy and communicate quickly with both us and our accountant.
  
 
 
      Posted on Google  
   
   Rob van den Bergh  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Always professional.
  
 
 
  
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         Posted on Google  
   
   Daniel McGregor  
 11. August, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  I have been using Swanson Reed for my clients for more than a decade.  Having a specialist firm that can provide practical and commercial advice that produces real outcomes is very important and we have received great feedback from our clients. Highly recommended.
  
 
 
      Posted on Google  
   
   John  
 15. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian and the rest of the team at Swanson Reed have been supporting us for several years.  We always appreciate their insights, expertise, and efforts.
  
 
 
      Posted on Google  
   
   Rueben Rajasingam  
 6. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Experienced responsive Team. They have been a great help to me and my company navigate the R&D tax claim process and have provided invaluable advice.
  
 
 
      Posted on Google  
   
   Enrique Esquivel  
 6. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian and the team at Swanson Reed have been extremely helpfully and professional during all of our consultations. Highly recommended.
  
 
 
      Posted on Google  
   
   Jess at Y&C  
 3. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  
  
 
 
      Posted on Google  
   
   Anatole Kononewsky  
 2. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  The Swanson Reed team have provided our company with exceptional professional advice and assistance for all of our R&D claims for many years - have always achieved great results with excellent value for their services.
  
 
 
      Posted on Google  
   
   Payam Toloo  
 2. June, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Damian Smyth and his team are very helpful, supportive and experts in their field of R&D Tax claims. I'm always happy with the work they do and been a customer of their for over 5 years.
  
 
 
      Posted on Google  
   
   Melissa Doddy  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  The Team at Swanson Reed are very experienced R&D Tax Advisors and gave us ongoing support with all of our R&D Claims, the consultants ensured we were always working with current legislative guidelines, gave us assistance with compiling technical and government documentation and went out their way to ensure they were with us for the entire process from beginning to end.  Highly recommended to anyone who needs assistance with working through what can at times be a daunting process.
  
 
 
      Posted on Google  
   
   Gary Watson  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  We can highly recommend Swanson and Reed as an R & D accountant. We have worked with them for several years now as they make our R & D claim so easy and communicate quickly with both us and our accountant.
  
 
 
      Posted on Google  
   
   Rob van den Bergh  
 31. May, 2022
 
 
 Trustindex verifies that the original source of the review is Google.  Always professional.
  
 
 
  
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How Valuable is Australia’s Refundable R&D Tax Offset on a Global Scale?

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How Valuable is Australia’s Refundable R&D Tax Offset on a Global Scale?

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