Overview of the R&D Tax Incentive

About this grant

program which supports you to invest in eligible research and development

Eligibility requirements

All of the following criteria must be met:

• The R&DTI is open to all industry sectors and company sizes. Any company that meets the definition of an
• R&D entity
• can apply.
• How to calculate your tax offset
• The R&D tax offset is determined by your aggregated company turnover.
• Companies with turnover of less than $20 million
• The refundable R&D tax offset is equal to your corporate tax rate plus an 18.5% premium.
• Companies with turnover of $20 million or more
• The non-refundable R&D tax offset is equal to your corporate tax rate plus a premium. The premium is calculated based on the notional R&D expenditure as a proportion of total expenditure for the income year.
• Proportion of notional R&D expenditure to total expenditure
• Tax offset
• Up to 2 % of total expenditure
• Corporate tax rate + 8.5 %
• Above 2 % of total expenditure
• Corporate tax rate + 16.5 %
• Up to 2 % of total expenditure
• Tax offset
• Corporate tax rate + 8.5 %
• Above 2 % of total expenditure
• Tax offset
• Corporate tax rate + 16.5 %
• More information on what you may be able to claim under the R&DTI can be found on the Australian Taxation Office’s (ATO)
• Rates of R&DTI offset
• page.
• When to apply
• You must apply to
• register for the R&DTI
• within 10 months of the end of the income year in which your R&D activities took place.
• Once your activities have been registered, you can lodge the 'R&D Tax Incentive schedule' with your company tax return and
• claim the benefit through the ATO
• .
• Who administers the program?
• The R&DTI is jointly administered by:
• the Department of Industry, Science and Resources (the department), on behalf of Industry Innovation and Science Australia, and
• the ATO.
• The department registers R&D activities for the R&DTI. The ATO processes R&DTI expenditure claims.
• How the R&DTI works
• Step 1: plan your R&D
• Planning allows you to determine the objectives of your R&D, the activities that you intend to conduct and what is required to conduct them. The department provides support for planning eligible R&D activities, we recommend:
• attending an
• information session
• reading the
• Guide to Interpretation
• .
• You should
• keep records
• before, during and after each activity (including records of your associated expenditure). You will need these records if the department or ATO reviews your claims.
• If you plan to claim overseas R&D expenditure, you must first have a positive
• overseas finding
• .
• You may also consider collaborating with a
• research service provider
• which can assist with planning and conducting your R&D.
• Step 2: self-assess your eligibility
• Like the rest of the tax system, the R&DTI is based on self-assessment. This means, before applying to register for the program, you are responsible for assessing that you are:
• an
• eligible R&D entity
• conducting
• eligible R&D activities
• claiming
• eligible R&D expenditure
• .
• If you want assurance that your activities are eligible before registering for the R&DTI, you can apply for an
• advance finding
• .
• Step 3: conduct R&D
• Conduct your R&D activities.
• Remember to
• keep records
• before, during and after each activity (including records of your associated expenditure). You will need these records if the department or ATO reviews your claims.
• Step 4: register for the program
• Register your eligible activities
• with the department. You must do this within 10 months of the end of your company’s income year in which the activities took place.
• The R&DTI is a self-assessment program. Confirmation of registration by the department does not mean your activities are eligible.
• The department and the ATO may
• review the activities in your claim
• to ensure they comply with legislation. We may do this at the application stage or after your activities are registered.
• Step 5: claim your tax offset
• After registering for the R&DTI you will be provided with a registration number. To claim your tax offset you must enter your registration number into the 'R&D Tax Incentive schedule' of your company's annual income tax return. You can then lodge your tax return with the ATO.
• Steps for claiming R&D tax offset
• covers the process to claim your benefit.
• Important considerations
• R&D tax transparency reports
• The ATO is required by law to publish certain details of entities that claim the R&DTI. More information can be found on the
• R&D tax transparency reports
• page.
• Taxpayer alerts
• The ATO prepares taxpayer alerts to provide a summary of their concerns about new or emerging higher risk tax arrangements or issues.
• Helping get your R&D claims right
• covers taxpayer alerts specific to the R&DTI.
• Need help?
• Let us answer your question over the phone, email or live chat.
• Phone:
• 13 28 46

What the funding covers

• A tax offset for R&D expenditure of up to $150 million.

How to apply

1. 1Visit https://business.gov.au/grants-and-programs/research-and-development-tax-incentive/overview-of-rd-tax-incentive for application details

Application tips