The Department of Industry, Science, Energy and Resources just provided an update in relation to COVID-19 and the R&D Tax Incentive.
As the Federal Government’s leading incentive program for innovation, the R&D Tax Incentive offers offsets of up to 43.5% of eligible expenditure to businesses who have engaged in eligible R&D activities. For certain eligible entities whose aggregated turnover is less than $20 million, this tax offset can result in significant cash refunds. Eligible expenditure incurred on R&D activities, which may include salary, contractor and certain other expenses, can be claimed through the scheme.
The Application for Registration of R&D Activities must normally be lodged with AusIndustry within 10 months after year end, which for businesses with a 30 June financial year end would be prior to April 30. Today’s update announces that, if your application for the 1 July 2018 – 30 June 2019 income year cannot be made by the application deadline (30 April 2020) due to any effects of the COVID-19 pandemic, AusIndustry will allow your application to be made by 30 September 2020 without the requirement to request an extension.
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ShineWing Australia can assist with the identification and scoping of eligible activities, R&D governance, and preparation and lodgement of the application. We recommend businesses in a refundable position to submit their claim early and benefit from timely processing of your refund and enhanced cash flow during this period of uncertainty.