17th November 2020   |   Grants

R & D Grants

For the 2020 Financial Year Loss-making companies with $50M turnover. For every $1 of R&D expenditure across a company’s P&L (which is extensive), the company receives a tax offset of 43.5%. Each $1 of R&D expenditure is treated as income. If the company has made a profit, 27.5% company tax is payable on each $1 of R&D less 43.5% tax offset.

The benefit of profitable businesses is 16%. Profit-making companies <$50M turnover. If the company has made a loss equal to or more than the R&D expenditure, the 27.5% company tax is not payable and the full 43.5% tax offset is applied as a cash refund. The carryforward losses applicable to each R&D expenditure $ would not be available for future years.

 For FY21: Same as above except the company tax rate moves to 26% and the Tax Offset moves to 44%. We would welcome the opportunity to discuss any potential R&D activity in your company.

Speak to our specialist Mark Bouw who has the experience and knowledge with the R & D Grants program.

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