R&D tax incentive 2013

Substantiating an experiment: The R&D tax conundrum

Source: Taxation In Australia Journal Article

Published Date: 1 Mar 2013


The research and development (R&D) tax incentive is a new entitlement-based program that is in effect for financial years commencing on or after 1 July 2011. It replaces the former R&D tax concession program. The incentive offers a 45% refundable tax offset for companies with a group turnover of less than $20m and 40% non-refundable tax offset for companies with a group turnover exceeding $20m. Companies have been able to register their R&D activities under the incentive since 1 July 2012. However, lack of clarity around changes that have been made to the R&D tax legislation, together with recent decisions by the Administrative Appeals Tribunal (AAT) about substantiation of claims, have contributed to uncertainty for taxpayers during the transition to the new regime.

This article provides an overview of the new requirements, examines the implications of the AAT decisions, discusses the difference between documentation and substantiation, and provides a case study.

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R&D tax incentive 2013

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