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  • Claiming the research and development tax offset?

    10 January 2022

    The Research & Development (R&D) Tax Incentive allows companies to claim a tax offset for their R&D expenses incurred on their registered R&D activities. Companies can claim when lodging their annual company income tax return. Smaller companies may claim the R&D tax incentive as a refundable tax offset.

    If you've registered for the offset, the 'at-risk' rule helps to determine if your R&D expenditure is eligible for the offset under the scheme. It looks at whether expenditure you intend to claim a tax offset for can be considered 'at risk'. We’ve recently clarified the rule and how it applies to expenses claimed as an R&D tax offset to help you make your decisions.

    Claims for R&D tax offsets may be denied or reduced where the expenditure doesn’t satisfy the at-risk rule. This could be where expenses are fully or partly reimbursed.

    For example, you can’t include wage expenses spent on R&D activities in working out the amount of your eligible R&D expenses if you’ve received JobKeeper payments to help you pay those wages.

    You should carefully review the expenses you’re including in your R&D tax offset claim to ensure you only include eligible expenses.

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