Deductibility of R&D Expenditure Under Other Provisions

March 16th, 2014

  • If an amount is eligible to be claimed under the R&D tax incentive, you must claim it under Division 355 of the Income Tax Assessment Act 1997 (ITAA 1997).
  • The answer to the frequently asked question explains this rule further.

I have registered my R&D activities but want to claim some of the expenditure on those activities under section 8-1 of the ITAA 1997. Can I do this?

No. Amounts incurred on your registered R&D activities must be claimed under the R&D tax incentive.

Under the:

  • R&D tax concession, you could choose to claim an amount under another deduction provision rather than section 73B of the ITAA 1936
  • R&D tax incentive, if an amount meets the eligibility requirements under Division 355 of the ITAA 1997, it must be claimed under that Division.

If you choose not to claim your expenditure under the R&D tax incentive, you cannot claim it elsewhere on your tax return.

You can only claim a deduction under section 8-1 (or other provision) of the ITAA 1997 if the expenditure does not meet the eligibility requirements under Division 355. This means that if your R&D activities are registered with AusIndustry, you can only claim your expenditure on those activities under the R&D tax incentive.

Visit Research and development tax incentive – home for more information about when you are eligible to deduct an amount under Division 355 of the ITAA 1997, including the requirements to:

  • be an eligible R&D entity
  • incur expenditure on eligible R&D activities
  • register your R&D activities with AusIndustry.

Courtesy of the ATO

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