The R&D Tax Incentive (RDTI) scheme is a self-assessment scheme. AusIndustry assumes that you know the requirements of the scheme and are familiar with their guidelines. Hence, AusIndustry may not check the application closely when you submit the application. If anything in your application does raise a red flag, then the application may get a closer inspection by AusIndustry when you submit it.
Even if the application goes through and you do receive your refund, AusIndustry can review the application up to four years later. There are various triggers for an AusIndustry review. The most common is that AusIndustry may select you for a random review. However, you may also be a client of an R&D Tax Incentive consultancy who is being targeted for reviews by AusIndustry.
AusIndustry Reviews of R&D Tax Incentive applications
Reviews by AusIndustry can be quite thorough, so you will need to have your supporting documentation in order. As noted above, AusIndustry can go back 4 years reviewing Tax Incentive applications. If you have had a systemic problem with your applications, AusIndustry can decide to review all 4 years.
Sorting out 4 years of problematic applications can be done, provided that there is actually eligible R&D. However, it can be expensive and time-consuming. It is much better for you to avoid being in that position in the first place.
Choose a dependable R&D Tax Incentive Consultant
How an R&D Tax Incentive consultancy handles an AusIndustry review will speak volumes about whether they are a reliable firm for you to be dealing with. Many firms will be happy to submit your applications, but the list of firms who handle AusIndustry reviews well is much smaller. Tech Abstract has a number of clients who were abandoned by their previous consultant during an AusIndustry review.
R&D Tax Incentive self-assessment – prepare a good application
The moral of the story is – prepare a good application upfront, and you will significantly reduce the possibility of problems. You may still be selected at random for a review later. However, if the application is well-written and describes eligible R&D, then that review will typically go through smoothly.