• Item 3

    Attention

    Warning:

    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    Other R&D expenditure

    (relevant to Australian owned and foreign owned R&D)

    At item 3 show eligible other R&D expenditure incurred directly in respect of relevant research and development activities carried on, by or on behalf of the company, or wholly or primarily on behalf of a grouped foreign company. (See paragraph (c) of the definition of 'research and development expenditure', subsection 73B(1) of the ITAA 1936.)

    Do not include amounts to be shown at item 4 Contract - other or item 5 Plant leasing.

    Overhead and administrative expenditure are directly in respect of research and development activities where:

    • the eligible research and development activities contributed to all or an identifiable part of the expenditure being incurred, or
    • the conduct of eligible research and development activities by the company would be materially impaired if the expenditure was not incurred.

    You cannot claim this type of expenditure in respect of Australian owned R&D unless your aggregate research and development amount is greater than $20,000.

    You cannot claim this type of expenditure in respect of foreign owned R&D unless your expenditure on foreign owned R&D is greater than $20,000.

    Adjust the amount of other research and development expenditure claimed in accordance with the prepayment provisions (sections 82KZL to 82KZMF of the ITAA 1936).

    'Other R&D expenditure' does not include:

    • core technology expenditure
    • interest expenditure
    • feedstock expenditure (show eligible feedstock expenditure and residual feedstock expenditure (Australian owned R&D only) at separate items)
    • expenditure incurred acquiring or constructing tangible assets, plant, pilot plant (including certain prototypes) or a building, or extending, altering or making improvements to a building
    • expenditure incurred acquiring or constructing a section 73BA depreciating asset
    • other expenditure in respect of Australian owned R&D where your aggregate research and development amount is less than or equal to $20,000
    • other expenditure in respect of foreign owned R&D where your expenditure on foreign owned R&D is less than or equal to $20,000.

    At H show the total amount of 'other R&D expenditure' incurred (the base amount), excluding any amounts to be shown at items 4 or 5.

    At I show any amount of other R&D expenditure on Australian owned R&D claimable at 100%.

    At J show any amount of other R&D expenditure on Australian owned R&D claimable at 125%.

    At K show any amount of other R&D expenditure on foreign owned R&D.

    The total of the amounts at I, J and K must equal the base amount at H.

    For more information, see:

    • subsection 73B(1), 73B(14), 73B(14C) and 73B(14D) of the ITAA 1936
    • Guide to the R&D tax concession.
    Last modified: 02 Jun 2010QC 22870