Startups Using Accrued R&D Tax Offsets to Access Finance Ahead of Lodgement

May 5th, 2020

An Article in the Sydney Morning Herald during the week has highlighted the increasing trend of companies seeking finance based on anticipated R&D Tax Entitlements.

This allows companies to access funding now, based on a portion of what their anticipated R&D Refund is expected to be, once claims can be lodged after 30 June.

Providers of such finance usually require:

  • interim financial statements and R&D Calculations to be reviewed in detail;
  • an assessment of the companies R&D Activities to be undertaken by an independent R&D Tax Advisor;
  • ATO lodgements up to date for BAS and tax returns.

There are fees and charges associated with these finance products, and companies pursuing this should ensure that:

  • They have suitable documentation able to support the claims that they are pre-funding against;
  • They have understood the relevant terms of the finance.

Swanson Reed has established working relationships with providers of such finance mentioned in the article, namely Radium Capital, and found their terms and processes to be reasonable and efficient.

Swanson Reed is a separate business from the financiers, and receives no commissions from our clients who engage them.

Source: Sydney Morning Herald; Radium Capital

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