Research and development record keeping

To work out your notional R&D deduction and support your claims, you need to keep records to show all of the following:

  • how the expenditure you have incurred relates to the R&D activities you have registered
  • how you have apportioned your expenditure between eligible R&D activities and ineligible activities
  • that you receive the major benefit from the R&D activities
  • when amounts have been paid to associates
  • how you have calculated adjustments required as a result of either  
    • receiving a government recoupment (clawback)
    • producing a marketable product (feedstock adjustments).

These records must be relevant to the year you are claiming your R&D tax offset. However, if you need to make adjustments these records may also be relevant for future years.

You must keep up-to-date records for each R&D activity so you are ready to calculate and claim your R&D tax offset in your company tax return at the end of the year.

The records you currently keep for your business will generally be enough to support your R&D tax offset claim, if they show:

  • you incurred the expenditure (and if incurred to an associate the amount(s) paid)
  • the expenditure was eligible for the R&D tax incentive
  • you received the major benefit from your expenditure on R&D activities
  • the amount of your expenditure that relates to the R&D activities you have registered with AusIndustry.

You must also be able to support your methodology for apportioning your expenditure between eligible R&D activities and non-eligible activities.

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For examples of records you may need to keep in relation to your R&D activities, visit the AusIndustry website and refer to R&D Tax IncentiveExternal Link.

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It is your responsibility to show us that the basis for calculating your notional R&D deduction produces, as far as practicable, accurate claims consistent with the law and its interpretation. You must be able to substantiate your claims for R&D expenditure with your records.

    Last modified: 19 Jun 2012QC 26104