R&D rate reduction - what it means

The rates of the refundable and non-refundable R&D tax offsets were reduced by 1.5 percentage points last year.

This resulted in the refundable offset being reduced to 43.5% and the non-refundable offset was reduced to 38.5%.

The refundable offset is available to R&D entities with an aggregated annual turnover of less than $20 million (unless controlled by one or more tax-exempt entities).

The non-refundable offset is available to R&D entities that do not qualify for the refundable offset.

Note: The Tax Laws Amendment (Research and Development) Bill 2013 prevents companies with aggregated assessable income of $20 billion or more accessing the offset.

This claim can be very lucrative; however, rules apply process and financials. Strangely, trusts are excluded, so set up a company or use your trustee company but seek advice from the accountant.

At TaxAssist Accountants we have experience of claims for over $100,000 and can attest it’s a good program.

For more information, contact one of our accountants along the East Coast.

Date published 17 May 2017

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.