What is a feedstock adjustment?

A feedstock adjustment is an amount you include in your assessable income. It applies when you obtain an R&D tax incentive offset for your feedstock expenditure incurred on R&D activities, where those activities produce either of the following:

  • marketable products
  • products you apply to your own use.

The feedstock adjustment applies to expenditure on the following:

  • goods or materials (feedstock inputs) that are transformed or processed during R&D activities in producing one or more tangible products (feedstock outputs)
  • energy that is input directly into that transformation or processing.

The feedstock provisions apply to both core and supporting R&D activities that transform or process feedstock inputs. The provisions are not confined to mass production activities.

Where a feedstock adjustment is triggered, you must include an amount in your assessable income. This may be in the current or in a future income year, depending on when the output is sold or applied.

    Last modified: 25 Oct 2016QC 24621