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  1. Surveys
  2. 2013
  3. November
  4. R
  5. R&D Eligibility Wizard - Swanson Reed
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Questions marked with an * are required Exit Survey
 
 
Welcome to our step-by-step wizard to help you check your eligibility for the new R&D Tax Incentive.

The new R&D Tax Incentive laws apply to R&D activities from 1 July 2011. You could be eligible for either a:

  • 45% Refundable (Cash) R&D Tax Offset - for companies with an aggregated group turnover less than $20 million; or

  • 40% Non-Refundable R&D Tax Offset - for companies with an aggregated group turnover more than $20 million.

If you are eligible you will have until 30 April to apply for your R&D Tax Offset.

Note: This Wizard is intended as a quick guide and should not be used as a substitute for professional advice. Please contact Swanson Reed for professional advice tailored to your requirements.
 
 
 
* Name:
   
 
 
* Company:
   
 
 
* Phone:
   
 
 
 
Is the business a registered Australian company?
 
Yes
 
No
 
 
Is your business part of or affiliated with any trusts?

Note: There are some circumstances involving trusts where your company may be ineligible. Swanson Reed can help clarify if your business is still eligible to make a claim for the R&D Tax Incentive.

 
Yes
 
No
 
 
If the company is controlled by a foreign owned entity, are the main R&D activities conducted in Australia?
 
Yes
 
No
 
NA
 
 
Core R&D Activities

To claim the R&D Tax Incentive you will need to identify the following for each project:

1) Core R&D Activities
2) Supporting R&D Activities.

Each project must have at least one Core R&D Activity. You will be required to register your Core R&D Activities with AusIndustry before you can claim your benefit. If you are able to answer Yes to all of these questions, you will have eligible Core R&D Activities and you will have an eligible R&D claim for the R&D Tax Incentive.
 
 
 
Is your company spending money on R&D activities?
 
Yes
 
No
 
 
Are your R&D activities part of a planned, systematic progression of work?

Note: This does not meant that you need to be a scientific company, but rather there is a planned progression of work that is not ad-hoc.
 
Yes
 
No
 
 
Are the activities for the purpose of generating new knowledge?
 
Yes
 
No
 
 
Is there a knowledge gap to achieve the desired technical outcome which cannot be solved through current knowledge and experience?
 
Yes
 
No
 
 
Is the expenditure incurred on behalf of your company?

Note: This test must be applied where there are multiple parties involved in the R&D such as a contractor or client. The correct claimant is the entity that, on balance, has the beneficial ownership of results, controls the R&D activities and the financial burden. If unsure, we recommended contacting an R&D specialist to ensure the correct claimant makes the R&D claim.
 
Yes
 
No
 
 
Are your R&D activities for the purpose of creating a new software product?
 
Yes
 
No
 
 
Do your R&D activities exclude all of the following?

Note: All of these are not eligible as Core R&D Activities:

a) Market research
b) Prospecting, exploring or drilling
c) Management studies or efficiency surveys
d) Research in social sciences, arts or humanities
e) Patenting, licensing etc.
f) Compliance with standards
g) Reverse engineering
h) Software development for “internal administration”
 
Yes
 
No
 
 
Are all your R&D activities conducted in Australia?
 
Yes
 
No
 
 
Overseas Activities

If you are able to answer Yes to all of these questions, you may be eligible to apply for a special Overseas Finding to claim additional overseas activities and expenses.
 
 
 
Are any of the activities (Core or Supporting) intended to be carried out overseas?
 
Yes
 
No
 
 
If you have Overseas Activities, is there a direct scientific connection to your Core R&D Activities?
 
Yes
 
No
 
 
If you have Overseas Activities, are these unable to be conducted in Australia for reasons such as population, geographical or geological limitations?
 
Yes
 
No
 
 
Will the Overseas Activities be less than the Australian activity portion of your project?
 
Yes
 
No
 
 
Supporting Activites

In addition to Core R&D Activities you can also claim Supporting R&D Activities including company overheads and administration costs. Supporting R&D Activities must be directly related to Core R&D Activities. They can be excluded Core R&D Activities (Refer Question 15). There are 2 categories of Supporting R&D Activities and each has a separate treatment for tax purposes:

1) Directly related to producing goods or services
2) Not directly related to producing goods or services

It is recommended that you contact Swanson Reed to determine whether your activities fall into category 1 or 2 and to find out what specific treatment is required.

 
 
 
Timing of R&D Activities and the R&D Claim

This section will help you work out when you should make an R&D Claim. R&D Claims are always made after the end of the relevant financial year. Claimants have 10 months to register the eligible R&D Activities with Innovation Australia. For 30 June year ends in the 2013 financial year, your R&D registration deadline is 30 April 20134. Claimants are required to register with Innovation Australia before claiming their tax rebates.
 
 
 
Did your company undertake either Core or Supporting R&D Activities in the 2012 financial year?

Note: Core or Supporting Activities can take place in any order. Activities can also span multiple financial years and have commenced prior to 1 July 2012.
 
Yes
 
No
 
 
Did your company incur non capital expenditure of more than $20,000 during the 2012 financial year?

Note: Your notional R&D deductions can include internal labour, some materials and consumables, travel, testing, contractors, plant depreciation, eligible feedstock and some company overheads.

Note: This minimum $20,000 requirement is not applicable to payments to Research Service Providers (RSPs) or monetary contributions under the CRC program.
 
Yes
 
No
 
 
Did your company receive a government grant or recoupment in the 2012 financial year?

Note: R&D tax claims are still allowed. However it will require an adjustment to the eligible R&D claim in all years to which the recoupment relates.
 
Yes
 
No
 
 
Substantiation and Record Keeping

The R&D Tax Incentive is based on the self assessment system. This means that although you will most likely receive automatic registration and payment of R&D rebates, at some point in the future a review will likely occur to establish eligibility.

AusIndustry or Innovation Australia is the body responsible for reviewing eligibility of activities while the Australian Taxation Office is responsible for reviewing the eligibility of claimant entities and expenditure.

To minimise compliance risk for the R&D Tax Incentive, it is strongly recommended to record and collate documents that substantiate each of the eligibility questions mentioned in this survey. Where there is any uncertainty please contact Swanson Reed to discuss your requirements.
 
 
 
Do you have documents that substantiate all of the information claimed in each eligibility question above?
 
Yes
 
No