Many international researchers are choosing to conduct their research and development in Australia to take advantage of the new R & D tax incentive program.
The key concepts are:
- A 45% tax offset for expenditure on eligible R & D activities which may be refundable to companies with a group wide turnover of under $20 million
- A 40% tax offset for expenditure on eligible R & D activities to companies with a group wide turnover of over $20 million
- An uncapped refund amount
- Companies with under 50% ownership by tax-exempt entity may qualify
- An Advance Finding process allows companies to seek formal determinations in respect of activity eligibility
- An advance Overseas Finding can be sought to enable up to 50% of a projects costs to be incurred overseas
What Qualifies? Core and supporting activities include:
- Core experimental activities that are conducted by applying a systematic progression of work to generate new knowledge, including new or improved materials, products, devices, processes or services.
- Supporting activities that are directly related to the core R & D activities
- If Supporting activities are related to the production of good and services or if they are on a list of excluded activities, then they must satisfy a dominant purpose test
- Overseas R & D must have significant scientific links to one or more core Australian activities. Expenditure on relevant overseas activities must be less than that incurred on Australian R & D activities
Contact us to learn more about the R & D program.