To Be Eligible To Apply For The R & D Tax Incentive You Must Be One Of The Following:
- a company incorporated under Australian law ( not a sole trader, partnership or most trusts ); or
- a compnany which although incorporated under foreign law is an Australian resident for tax purposes; or
- a company is incorporated under foreign law, that is a resident of a foreign country with a double tax agreement with Australia that carries on a business in Australia through the permanent establishment of the body corporate in Australia.
What Does The R & D Tax Incentive Offer My Business?
Eligible entities with a total turnover of less than $20 million receive a 45 per cent refundable tax offset. This is the quivalent of a 150 per cent deduction.
All other eligible entities are eligible for a non refundable 40 per cent tax offset. This is the equivalent of a 133 per cent deduction.
For the purpose of the R & D Tax Incentive activities must fit into either the 'core' or 'supporting' R & D categories.
Core R & D activities are experimental by nature:
The outcome of these activities cannot be known or determined prior to the activity based on current knowledge, available information or experience. These activities should proceed from the stage of hypothesis, through experimentation, observation and evaluation lead to a logical conclusion.
The purpose these activities is the generation of new knowledge. The new knowledge produced can be in the form of improved materials, products, devices, processes or services.
Supporting R & D Activities:
These are activities that are directly related to core R & D activities in a supportive role. These activities while not a central part of the experiment or activity are necessary for it to occur. Ausindustry has created a list of activities which fall into this category and are excluded from being included as a core R & D activity.
For further information contact us or visit www.ausindustry.gov.au.