Reminder – R&D Tax Incentives and critical dates looming for registration with AusIndustry

An important deadline is looming if your organisation is accessing the R&D Tax Incentive.

Companies accessing the R&D Tax Incentive must register their R&D activities with AusIndustry before they are able to claim the benefits of the R&D Tax Incentive. The deadline for lodging an application for registration is 10 months after the end of a company's income year. This means that if an organisation has an operating period from 1 July 2014 to 30 June 2015, it must lodge its registration application with AusIndustry no later than Monday 2 May 2016.

Please note that if an application for registration is received after the deadline, it is deemed a late application and will not be accepted.

Expenditure on overseas activities

The ATO advises that in order to claim a notional deduction for overseas R&D activities, an organisation must first get a positive overseas finding from Innovation Australia. On the basis that the conditions are met and Innovation Australia grants the overseas finding, the organisation can only claim expenditure on an R&D activity carried out overseas if the activity is registered and is covered by a finding that it meets the conditions specified.

What about “incidental expenditure” on overseas activities?

The ATO advises that it will accept notional deductions of minor amounts of expenditure on overseas R&D activities as deductible without an overseas finding from Innovation Australia.

The kind of expenditures constitute “minor”? As noted at http://www.business.gov.au, expenditure on overseas R&D activities that are insignificant in the context of an Australian R&D project such as sending R&D staff overseas to observe techniques or to attend a relevant conference will qualify.

The bottom line is that if your organisation is planning on accessing the R&D Tax Incentive benefits, time may be of the essence.