July 3rd, 2018
The Government announced on 8 May 2018 that the Research and Development Tax Incentive (R&DTI) would be reformed and that changes would apply from 1 July 2018.
Draft legislation has been released regarding amendments to the R&DTI. Stakeholder feedback is encouraged and responses can be submitted until 26 July 2018.
Changes to the Bill include:
- Increasing the R&D expenditure threshold from $100 to $150 million;
- Introducing a $4 million cap on annual cash refunds (the cap excludes clinical trials). Refunds over this amount may be carried forward into future years as a non-refundable offset;
- Companies with an annual turnover over $20 million will be entitled to an increased R&D tax offset rate equal to their corporate tax rate plus a premium based on R&D intensity;
- Companies with an annual turnover below $20 million will be able to receive an R&D tax offset rate equal to their corporate tax rate plus a 13.5 percent premium;
- Changes to the application of feedstock and clawback adjustments.