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Business Council renews calls for increase to R&D Tax Incentive Expenditure Cap

January 13th, 2025

The initial cap on eligible expenditure under the R&D Tax incentive was originally introduced around 2015 and set at $100 million. The R&D Tax Incentive (Treasury Laws Amendment (Research and Development Tax Incentive) Bill 2019 then introduced adjustments to the intensity threshold ranges, increasing the cap on claimable R&D expenditure from $100 million to $150 million. In recent years there has been public criticism from industry leaders such as Dig Howitt, the CEO of Cochlear noting that the current tax regime hinders large companies’ […]

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December 2024 MYEFO Announces Exclusion for Gambling and Tobacco Companies under the R&D Tax Incentive

December 18th, 2024

The 2024‑25 Mid‑Year Economic and Fiscal Outlook (MYEFO) was released by the Government on 18 December 2024.   In what is a new approach to Australian Government R&D Tax Policy changes, a restriction is being applied to specific sectors. The budget papers note: The Government will exclude activities related to gambling and tobacco from Research and Development Tax Incentive eligibility for income years starting on or after 1 July 2025. Research and development activities related to gambling can exacerbate addiction […]

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Federal court matter (December 2024) declares that respondent was a promoter of a tax exploitation scheme to secure R&D Tax Offset.

December 16th, 2024

A federal court case with judgement dated 16 December 2024 (with The Commissioner of Taxation as the Applicant and a number of parties as Respondents) has declared that respondents were promoters of tax exploitation schemes to secure R&D tax offsets pursuant to Division 355 of the Income Tax Assessment Act 1997 (Cth) for a number of companies. Very large penalties have been levied in the case and the liquidations of two entities listed as respondents were noted in the judgement as being on hold pending the outcome of […]

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New ATO Taxpayer Alert (TA 2024/1) for Early Stage Investor Tax Offset Claimed using Circular Financing Arrangements

December 16th, 2024

On 10 December 2024 the ATO released TA 2024/1: Early stage investor tax offset claimed using circular financing arrangements.   The alert notes that: The ATO are currently reviewing cases where individuals have claimed the early stage investor tax offset on shares acquired through tailored financing arrangements. These arrangements appear designed to artificially meet the conditions for claiming the maximum tax offset, allowing individuals to benefit with minimal (if any) risk on their investment. Entities promote, orchestrate, and finance these schemes […]

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