Australia

Details

  • Service: Tax, R&D Incentives
  • Type: Regulatory update
  • Date: 30/05/2013

Tax Insights

KPMG's analysis of tax issues and developments.

Paul Van Bergen

Paul Van Bergen
Partner, Tax

+61 2 9455 9373

pvanbergen@kpmg.com.au

Tax Incentive for overseas R&D 

by Paul Van Bergen, R&D Tax Incentives Specialist

Under the government's Research and Development (R&D) Tax Incentive Program, taxpayers who are conducting R&D activities overseas as part of broader Australian R&D activities are potentially eligible to claim the R&D Tax Incentive in respect of associated overseas R&D expenditure.

A prerequisite to claiming such expenditure is applying for an advanced finding within the first income year in which overseas R&D activities are carried out. For companies with a June year-end the overseas finding application must be lodged with the Innovation Australia Board by 30 June 2013.
 
To obtain an overseas finding, a taxpayer must establish that the overseas activities:

  • are covered by an advanced finding
  • have a significant scientific link to core Australian R&D activities
  • are not able to be conducted solely in Australia because conducting them:
    • within Australia would contravene a law relating to quarantine
    • requires access to a facility, expertise or equipment not available in Australia
    • requires access to a population (of living things) not available in Australia or
    • requires access to a geographical or geological feature not available in Australia and involve total expenditure across all income years less than the total expenditure across all income years on related Australian R&D activities (that is, constitute less than half of the total project expenditure).

Upon obtaining an overseas finding, a taxpayer must still successfully register the overseas activities with Innovation Australia within 10 months of year-end to access the R&D Tax Incentive.

 

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R&D Incentives

KPMG's R&D Incentives professionals can assist organisations to take advantage of the R&D and innovation benefits they are eligible to receive.