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Outsourcing R&D Tax Incentive assistance to ensure your claim is eligible
26 August 2020 | Minutes to read: 2

Outsourcing R&D Tax Incentive assistance to ensure your claim is eligible

By Dr. Rita Choueiri

Many R&D Tax Incentive (RDTI) claimants are surprised to discover that successfully registering an R&D claim doesn’t necessarily mean their claim is eligible. In most cases, the regulators, AusIndustry and/or ATO, don’t assess the eligibility of an RDTI claim before a company receives and spends its R&D refund.

The RDTI is a self-assessment program for which you, as the claimant, are solely responsible for assessing the eligibility of your claim. Considering 10,000+ registrations are being made each year, AusIndustry simply doesn’t have the capacity to review each claim at the time of lodgement. In fact, if it did, you’d probably be waiting twelve months or more for your R&D refund.

However, while the current process ensures that companies receive their R&D refunds as soon as possible, retrospective R&D compliance reviews have the potential to financially ruin a company. Companies who self-assess may have genuinely thought receipt of the R&D refund meant their claim had been approved, when in fact they may have been registering ineligible R&D activities, claiming ineligible expenditure or not have appropriate documentation in place to back up R&D claims made. If the claim is deemed ineligible, then a company could stand to pay back up to 4 years’ worth of R&D benefits and penalties plus interest. This uncertainty can be avoided by engaging a reputable R&D consultant to assist in claim preparation and ensure peace of mind with better compliance.

Our experienced R&D consultants can provide you with tailored advice based on your specific industry and projects. Our 28 collective years of experience advising on the RDTI means we have reviewed the eligibility of hundreds of projects and solved just as many problems.

If you prepare your R&D claim inhouse we recommend that you get a second opinion. Our team offers one high-level R&D review free of charge to identify any potential risks or obvious omissions. If risks are identified, you can take steps to have them rectified or de-risked to avoid unnecessary anguish if the regulators come knocking.

Why should you outsource to an R&D consultant?

  • More time to focus on your business – If you don’t have the time, resources or expertise to prepare an extensive R&D application and supporting documentation, you can rely on us to provide that extra support so that you can focus on growing your business.
  • De-risk R&D claims – Our experienced R&D advisors understand the nuances of the law and how best to frame and position R&D activities so that they meet the expectations of the regulators. What a company may consider to be R&D may not necessarily be R&D as described in tax law.
  • Optimise R&D claims – We will ensure you have considered and identified all possibilities for R&D activities and eligible R&D expenditure.
  • Identify and solve technical issues – We can provide consulting advice on more complex technical or ‘grey’ areas of R&D tax legislation that may come up in a claim (e.g. associate payments, feedstock adjustments and aggregated turnover calculations) that claimants aren’t always aware of.
  • Check substantiating documentation – We can provide consulting advice to ensure that you have the right contemporaneous documentation and evidence to substantiate your R&D work and back up everything described in your R&D Application and expenditure.
Outsourcing R&D Tax Incentive assistance to ensure your claim is eligible

Dr. Rita Choueiri

Dr. Rita Choueiri is a scientist and the head of the Melbourne R&D Incentives division. She is a keen promoter of innovation and is a highly regarded R&D specialist helping companies to identify R&D opportunities, determine project eligibility and set up the systems and processes to maximise tax offsets and minimise exposure.

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