Soon to be nestled on the foreshore of the Sydney Harbour is a technology marketplace that rivals the likes of Silicon Valley. That is at least the NSW government’s anticipation for Australia’s first digital district, ‘Silicon Harbour’ – a purpose built hub to unite the global giants of tech world with start-up entrepreneurs, business incubators and accelerators.
Indeed, the government’s support of an innovation agenda and local start-up network is showing no signs of decelerating. However, since the technology sector is predicted to grow at seven times the rate of the rest of economy, creating more opportunities and spaces for technology is vital. Moreover, over the next 25 years, the digital economy will grow from just above 5 per cent now to 22 per cent in 2040.
Nonetheless, Australia’s somewhat lacking innovation culture, can’t be solved by a new location alone. If we want to observe a more technological economy and create cutting-edge innovations, it is imperative for leaders, companies and the government to invest in research and development (R&D). By capitalising on the incentives the government has made available, established businesses and start-ups can obtain generous tax savings, including generating cash for their past and future investments.
In fact, the R&D Tax Incentive helped 13,000 companies with $2.4 billion in tax funding for eligible R&D investments in 2014 – 2015. Furthermore, every dollar counts for individuals engaged in start-ups and the R&D Tax Incentive is a crucial implement that can be used to offset costs when creating a product or service.
Consequently, the R&D Tax Incentive can not only have a positive effect on assisting start-ups, but can also increase an established company’s competitive edge in an increasingly innovative economy. Thus, organisations that take advantage of these incentives to drive innovation can create tax savings for their own business and assist in generating growth for Australia. If you believe your company is undertaking qualifying R&D activities, contact one of our specialists today to find out if you could benefit from R&D credits.