R&D Tax Incentive is an Australian Government program, jointly administered by AusIndustry and the Australian Taxation Office (ATO). AusIndustry is an operational division of the Department of Industry and Innovation and is responsible for technical compliance of applicants. The ATO is responsible for financial and taxation compliance.
The R&D Tax Incentive is a self-entitlement, self-education and self-assessment program.
Tech Abstract ensures that our clients are properly assessed for eligibility and are fully compliant, enabling the production of a successful application with a minimum time burden on the client.
Supporting the R&D Tax Incentive are:
- Five (5) pieces of legislation specifically relating to ‘research and development’ (R&D)
- Two (2) pieces of legislation relating to taxation
Tech Abstract as a registered tax agent for the R&D Tax Incentive, covering the R&D legislation and liaising with the client’s tax accountant to aid taxation compliance. See what does a tax Incentive consultant do?
To properly assess a clients’ eligibility for the R&D Tax Incentive, we need to assess the clients’ project and ascertain whether the entire project is eligible, or just elements of it.
There are six (6) stages for a project, from conceptualisation through to commercialisation.
How we help
Without the services of Tech Abstract, a new applicant may tend to consider innovative commercial attributes of their project as being eligible activities for the R&D Tax Incentive. However, this is not the case. Eligible activities must be attributable to the conceptualisation, research & development and technical proof-of-concept stages, and will cover both core and supporting activities.
For these activities to be eligible, there must exist ‘technical gaps’ which require ‘new knowledge’ to bridge these gaps. However, failure to establish new knowledge can also be eligible. To ensure eligibility it is important to identify what ‘technical gaps’ exist.
Prior to establishing Tech Abstract, the director of Tech Abstract, Jamie Collins, was engaged by AusIndustry as a field auditor. During his time as a field auditor, Jamie Collins used the analogy of “hitting a brick wall – you can’t go over it, under it or around it. To get past it you need to step back and conceive a possible way and then conduct R&D activities to get past the wall, or fail trying”.
Jamie Collins used this analogy to enable applicants to effectively describe their project’s ‘technical gaps’.
This analogy enabled the applicants to tell (in their own words) what their ‘technical gaps’ were and to describe what activities they had undertaken to gain the ‘new knowledge’ for a likely solution. This allowed an effective assessment to be made for the eligibility of their project’s activities.
Tech Abstract continues to use this proven method to support the assessment of clients’ projects, activities and expenditure, allowing Tech Abstract to only submit successful and compliant applications to AusIndustry. The R&D Tax Incentive is available to eligible Australian companies undertaking eligible R&D activities, conducted in an experimental manner through a systematic progression of work.
The R&D Tax Incentive program provides support in the form of an R&D Tax Offset of up to 43.5%. This offset is delivered by the ATO as a tax credit and/or tax refund, The value is determined by Tech Abstract in consultation with the clients’ external taxation accountant.