In mid-October, AusIndustry released version 5 of the R&D Tax Incentive Registration form. In light of the AAT case DBTL and Innovation Australia , the new form further highlights the need for contemporaneous documentary substantiation of registered activities.
The changes now mean that applicants must provide additional information regarding the nature of their R&D activities. The new changes mean that:
- Applicants must now describe the new knowledge intended to be produced from the core activities in the project and explain why it differs from the current knowledge database. Although this isn’t a new legislative requirement, it must now be explicitly covered in the application form.
- Applicants must now explain why the outcomes of the R&D project could not be determined in advance using the current level of knowledge, information and experience available. This helps assess whether the R&D undertaken was reasonable.
- Applicants must now describe how each supporting activity contributed to its relevant core R&D activity. This minimizes contention around application of the dominant-purpose test for supporting activities.
The new form provides guidance to allow applicants to appropriately self-assess their R&D activities whilst also promoting adherence to the legislation.