If you are a firm who uses technology as a foundation for creating new or improved products or services – and the development involves investing in a degree of experimentation or prototyping – there’s a high likelihood you may be eligible for the R&D Tax Incentive.
However, the fact remains that there is still quite a bit of confusion around what can and cannot be claimed. In one of our previous posts, we discussed what the ‘non core’ R&D Tax Incentive activities were. In this post, we look into what is considered ineligible expenses and expenditure.
When claiming for the R&D tax incentive, the following expenses are unlikely to have a link to R&D activities and thus considered ineligible expenses. Typically, these activities would relate to general company operating expenditure that the company would undertake regardless of R&D activities. Furthermore, there is also ineligible expenditure which cannot be notionally deducted under the R&D Tax Incentive. Please see the lists below to find out what expenses and expenditure is considered ineligible.
Undeniably, the rules and regulations surrounding the R&D tax incentive may be bewildering for some. Hence, a company may wish to seek external assistance to help identity their R&D eligible activities. Many accountants are not acquainted with the ins-and-outs of the R&D Tax, thus you may wish to consider a consultant that specialises in the area. Swanson Reed is a registered tax agent specialising in the R&D Tax Incentive – contact us today to discuss your eligibility and learn more about how the R&D Tax Incentive may benefit your business.