New R&DTI guidance to support investment in R&D

The Australian Government has issued refreshed R&D Tax Incentive (R&DTI) guidance to support companies investing in research and development.

The guidance follows the Government’s investment of a further $2 billion into the incentive, which provides a tax offset to support Australian companies to undertake additional research and development activities.

The Guide, refreshed in consultation with business and tax agents, features plain English, less duplication, and helpful diagrams and examples, together with content aligning with recent Federal Court and Administrative Appeals Tribunal (AAT) decisions. It offers straightforward and accessible advice for companies accessing the R&DTI, making it easier to find the information they need, says Minister for Industry, Science and Technology Karen Andrews.

“We’re focussed on getting the economic conditions right so Australian businesses can thrive, which is crucial to our recovery from the COVID-19 recession,” she said. “By giving greater clarity to the scope of eligible activities under the R&DTI legislation, we’re supporting more Australian companies to self-assess their R&D activities against the criteria and offset some of the associated costs.”

Alongside reforms announced in the 2020-21 Budget, providing clearer guidance material helps give companies the confidence and certainty to invest in the kinds of R&D that boosts Australia’s economy and creates highly skilled jobs, she added.

“We know that companies that conduct R&D are often more successful and contribute to economic growth at a higher rate.”
Companies are encouraged to use this resource and the guidance available at business.gov.au to self-assess the eligibility of their R&D activities.

EDITOR’S NOTE: The Editor’s own research in the defence industry has shown results consistent with the general view that companies investing in R&D perform noticeably better financially than those that do not.