Australia

Details

  • Service: Tax, R&D Incentives
  • Type: Regulatory update
  • Date: 17/01/2014

Tax Insights

KPMG's analysis of tax issues and developments.

Mark Prentice

Mark Prentice
Partner, Tax

+61 3 9288 5508

mprentice@kpmg.com.au

Government cost cutting/deferral measures impact the R&D tax incentive 

by Mark Prentice, R&D Tax Specialist

The Federal Government is going ahead with a measure that will prevent companies with Australian revenue exceeding $20billion from accessing the R&D tax incentive. This change was first proposed by the previous labor Government but has been supported by the current Government in a budget cost saving measure. Its impact is likely to prevent less than 20 larger company groups from receiving any benefits from the R&D tax incentive.

The Federal Government will also now not proceed with a measure that would have enabled small company groups with grouped global revenues of less than $20million from receiving quarterly advanced payments against their annual R&D tax incentive claim.

 

This will be a significant blow to many of the approximately 80 percent of companies claiming the R&D tax incentive who meet the small company group eligibility threshold and who were relying on this change to generate significant positive cash flows for their businesses.

 

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