R&D Tax Incentive Australia: Eligibility, Registration and Claim Support for Innovative Companies
The R&D Tax Incentive is an Australian Government program that gives eligible companies a tax offset for money spent on eligible research and development. Companies with aggregated turnover under $20 million can receive a refundable offset, which can be paid as cash even when the company is in tax loss. The program is run jointly by the Department of Industry, Science and Resources, which registers activities, and the ATO, which assesses the expenditure claimed.
- Who can claim
- Companies incorporated in Australia (and certain foreign companies) doing eligible R&D
- Minimum spend
- Generally $20,000 of eligible R&D expenditure in the income year
- Key deadline
- Register activities within 10 months of the end of the income year (30 April for a 30 June year-end)
- Who helps you
- SAQCH Partners: CPA-led registered tax agent working with tech, product and research companies
Reviewed by Saqib Chuhdhary, CPA and Xero Certified Advisor · Updated October 2026
"We Do R&D, but Our Records Won't Support a Claim."
Weak records are the main reason claims are reduced. We set up simple time and cost tracking during the year, so the claim is built from evidence, not reconstructed in April.
"We're Counting on the Refund, but Don't Know When It Lands."
Refund timing matters for runway. We map the registration and lodgement timeline and build the expected refund into your cash forecast.
R&D Tax Incentive: Quick Answers
Who is eligible for the R&D Tax Incentive?
Companies incorporated in Australia, and certain foreign companies operating here, can claim if they carry out eligible R&D activities and spend at least $20,000 on them in the income year. Sole traders, partnerships and trusts can't claim directly. The activities must include core R&D, not just routine development.
How much is the R&D Tax Incentive worth?
Companies with aggregated turnover under $20 million get a refundable offset at their company tax rate plus 18.5 percent, which is 43.5 percent for a company on the 25 percent rate. Larger companies get a non-refundable offset at their tax rate plus 8.5 or 16.5 percent, depending on how much they spend on R&D relative to total expenses.
When is the R&D registration deadline?
Activities must be registered with the Department of Industry, Science and Resources within 10 months after the end of the company's income year. For a standard 30 June year-end, that is 30 April the following year. Registration comes before the company tax return claiming the offset.
What counts as R&D for the incentive?
Core R&D activities are experimental activities whose outcome can't be known in advance from existing knowledge, carried out systematically through hypothesis, experiment, observation and conclusion to generate new knowledge. Supporting activities directly related to the core work can also count. Some activities, such as market research, can't be core R&D.
How much does R&D claim support cost?
SAQCH Partners charges a fixed fee agreed upfront, based on the number of projects, the state of your records and whether you need year-round tracking. The first eligibility conversation is free, so you know whether a claim is worth pursuing before any fee applies.
You may have an R&D claim if your company…
- Ran experiments where the outcome couldn't be known in advance.
- Built new software, products or processes that needed technical problem-solving.
- Paid staff or contractors to test, prototype or iterate.
- Spent at least $20,000 on that work in the year.
Book a free eligibility check before the registration deadline.
How Does the R&D Tax Incentive Work?
You register eligible R&D activities with the Department of Industry, Science and Resources, then claim the offset in your company tax return. The activities must include core R&D: experimental work whose outcome can't be known in advance, carried out in a systematic way to generate new knowledge. Supporting activities directly related to that core work can often be included too.
The rate depends on turnover. Smaller companies receive a refundable offset, while companies with turnover of $20 million or more receive a non-refundable offset that reduces tax payable, with any excess carried forward.
How much could a small company receive?
Refundable offset = eligible R&D expenditure × (company tax rate + 18.5%)
Example: a company on the 25% base rate with $500,000 of eligible R&D spend gets a 43.5% offset of $217,500. Compared with a normal tax deduction worth $125,000, the extra benefit from the incentive is $92,500.
Our R&D Tax Incentive Services
- ✓ Eligibility review of projects and activities
- ✓ Time and expenditure tracking set-up
- ✓ Registration support with the Department
- ✓ R&D tax schedule and company tax return
- ✓ Refund timing built into your cash forecast
- ✓ Support if the ATO or Department reviews the claim
R&D Tax Incentive Rates
| Aggregated turnover | Type of offset | Offset rate |
|---|---|---|
| Under $20 million | Refundable, can be paid as cash | Company tax rate + 18.5% premium |
| $20 million or more | Non-refundable, excess carried forward | Company tax rate + 8.5% on R&D up to 2% of total expenses, +16.5% above that |
R&D Claim Timeline for a 30 June Year-End
| When | What happens | Why it matters |
|---|---|---|
| During the year | Record hypotheses, experiments, results, staff time and costs | Evidence created at the time is far stronger |
| After 30 June | Finalise eligible activities and expenditure | Sets the size of the claim |
| By 30 April | Register activities with the Department | Missing the deadline usually means no claim for that year |
| After registration | Lodge the company tax return with the R&D schedule | The ATO processes the offset and any refund |
How We Prepare an R&D Tax Incentive Claim
Evidence first, so the claim holds up if it's reviewed
Eligibility Check
We review your projects against the core and supporting activity rules
Tracking Set-Up
Simple time sheets and cost codes in Xero or your payroll system
Calculate the Claim
Staff, contractor, materials and overhead costs allocated and checked
Register and Lodge
Registration with the Department, then the R&D schedule with the tax return
Plan the Cash
Expected refund built into runway and next year's tracking improved
R&D Tax Incentive Support for Australian Companies
First-Time Claimants
- Eligibility: A clear view of which activities qualify and which don't.
- Records: What evidence to keep, set up before year end.
- Deadline: Registration planned well before 30 April.
Startups & Scale-Ups
- Refunds: Refundable offset estimated for runway planning.
- Investors: R&D spend and incentives shown clearly in reporting.
- CFO link: Works with our virtual CFO for startups.
Repeat Claimants
- Review: Past claims checked for gaps and risks.
- Efficiency: Year-round tracking so claims take less time.
- Overseas work: Overseas findings planned before money is spent.
Problem, Fix, Result
| The problem | What we do | The result |
|---|---|---|
| "We're not sure our work qualifies." | Activity-by-activity eligibility review | A claim you can stand behind |
| "Staff time isn't tracked." | Light-touch time and cost tracking | Expenditure backed by evidence |
| "The refund timing is a guess." | Timeline mapped into the cash forecast | Runway planned with confidence |
Related services: Virtual CFO for Startups | Government Grants | Tax Accountant Sydney | Virtual CFO Macquarie Park
Ways to Work With Us on Your R&D Claim
Eligibility Check
- For: Companies unsure whether they qualify.
- Includes: Project review and a written view on eligibility and likely claim size.
- Fee: Free first conversation, then a fixed fee.
Full Claim Preparation
- For: Companies ready to claim this year.
- Includes: Expenditure calculation, registration support, R&D schedule and tax return.
- Fee: Fixed fee agreed upfront.
Year-Round R&D Tracking
- For: Repeat claimants and fast-growing tech companies.
- Includes: Monthly tracking, refund forecasting and claim-ready records.
- Fee: Fixed monthly fee.
R&D Tax Incentive FAQs
Answers on eligibility, core and supporting activities, records, software R&D, contractors, overseas findings, reviews and choosing an R&D adviser in Australia.
12 questions
Sources: business.gov.au R&D Tax Incentive · ATO R&D Tax Incentive · Department of Industry, Science and Resources · Tax Practitioners Board register
Ready to Get Started?
Schedule a ConsultationContact our team today to discuss how we can help your business succeed.
