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R&D Eligibility Assessments

Adequately assessing a potential R&D claim at the beginning is one of the most important parts of the R&D claim process.

In Australia, there are two main R&D Tax Offsets available to companies:

  • A 43.5% refundable tax offset (equivalent to a 150% deduction) to eligible entities with an aggregated turnover less than $20 million per annum.
  • A 38.5% non-refundable tax offset (equivalent to 133% deduction) to eligible entities with an aggregated turnover greater than $20 million per annum.

What can I claim?

R&D activities need to meet certain legislative requirements for them to be deemed eligible ‘core’ activities by AusIndustry. The basic 3 requirements of a ‘core’ activity are illustrated in the below flowchart.

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How much can I get?

No Claim 38.5% R&D Tax Offset 43.5% R&D Tax Offset
Assessable Income $200 $200 $200
Deduction/ R&D Spend ($100) ($100) ($100)
Deductions Claimed/ Forfeited $100 — —
Taxable Income $100 $200 $200
Gross Tax (30%) (30%) (30%) (30%)
R&D Tax Credit — $38.50 $43.50
Net Tax Payable ($30) ($30) ($30)
Benefit yield of R&D Spend 8.5% 13.5%

Calculate your Benefit

R&D claim tax-calculator

 

Industry Specific Audit Issues

AusIndustry undertakes periodic reviews of R&D activities and the documentation used to substantiate those activities.  The below industry specific checklists contain some of the information AusIndustry may review or request in the event an activity assessment is undertaken.

Are You Eligible?


Click here for the R&D Eligibility Wizard

R&D Audit Checklist


Click here for the R&D Eligibility Wizard

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