EOFY Research & Development Tax Incentive checklist

Are you eligible to claim?

Are you a company incorporated in Australia?

• Do you have a number of related entities in your group?
• Are you claiming under the right entity?

Are you conducting eligible R&D activities?

• Were you developing a new or improved product, system, device, process or service?
• Were the activities experimental where the outcome was unknown at the outset?
• Did you follow an experimental progression of work?
• Was there technical uncertainty or risk in the activities?
• Were you creating new knowledge?
• Did you encounter problems which required innovative problem solving approaches?

How have you documented your R&D activities?

Did you document what was unknown at the start of your activities?

Documents may include:

• Competitor analysis
• Review of current state of the industry

Did you set up a documentation or record keeping, including your technical hypothesis or objective when your activities commenced?

Documents may include:

• Business case
• R&D project plan/scope
• Product development meeting notes
• Emails with contractors/consultants
• Concept drawings
• Internal emails

Did you document your experimental process, test results, analysis, outcomes?

• Experimental data
• Trial plans
• Measurements
• Engineering drawings and revised drawings
• Emails describing the experiment or results
• Observations, photos, videos
• Discussions or meetings notes
• Test reports
• Consultant/contractor reports

Did you document your outcomes against your initial experimental aims?

How have you tracked your R&D expenditure?

• Did you set up a work order or project code?
• Did you develop templates for tracking project costs?
• Did you track personnel time and what activities they related to? (Timesheets, calendar entries)
• Have you separated out your R&D activities from your “business as usual” activities?
• Have you separated your ‘core’ from your ‘supporting’ R&D activities expenditure?
• Have you substantiated all direct costs? (Materials, travel, external testing)
• Did you sell the outcome of your R&D?

Key considerations to discuss with your R&D advisor prior to EOFY

EXTERNAL CONTRACTORS/CONSULTANTS:

• Did you engage any external contractors? The 'On Own Behalf' rules apply. Review your contracts for eligibility.

GOVERNMENT GRANTS:

• Did you receive any government grants related to the R&D activities? Clawback adjustment may apply.

FEEDSTOCK ADJUSTMENT:

• If you're selling or have sold the outcome of your R&D activities (goods or materials), a Feedstock Adjustment may apply.

ASSOCIATE PAYMENTS:

• Ensure any payments to Associates are properly incurred, and in the right entity prior to year end.

We work with companies to provide the tools to track your R&D activities and substantiate your R&D claims. For an obligation free assessment of your documentation and your company's compliance, contact us on:

Kate Mahady - kmahady@fbrice.com.au