Article by Avant Group - Preparation for the End of Financial Year – Research and Development Tax Incentive

Preparation for the End of Financial Year – Research and Development Tax Incentive

Posted: May 25, 2022

What is the Payments to Associates requirement for R&D projects?

If you are claiming the R&D Tax Incentive for the previous financial year, you must make your payments to associates by June 30th or December 31st for December year end companies. Payments to associates must be physically, transacted payments to be eligible.

An associate would be considered any entity that, by reason of family or business connections, might be regarded as being an associate of a particular business.

R&D businesses are only eligible for R&D Tax offsets, for R&D expenditure incurred by an associate entity if the expenditure has been paid during the claim period.

Preparation for Research and Development Tax Incentive Claim (1st July til 30th June)

To ensure ongoing compliance and the ability to meet R&D eligibility requirements, please ensure you continue to maintain contemporaneous (real-time) documentation to support your projects.

The auditing of R&DTI has increased significantly as there is an increased compliance lens on the program. In the past, applicants had a 1 in 10 chance of an audit, as we venture into FY21/22+, it is now a 1 in 3 chance of an audit.

At minimum it is recommended you undertake:
  • Technical investigation report
  • Project overview (scope of R&D activities)
  • Repository and evidence of experiments
  • Detailed and contemporaneous timesheet
To download our full R&D Kit, please get in touch with us here.

At Avant Group, we are keen to help you with the implementation of this process. If you would like to arrange a meeting or call to run through current projects and documentation, please feel free to click this link to schedule a time.

R&D Preparation Meeting
We will also be in contact with each Client separately, in the coming months to discuss the scope and prepare your R&D TI Claim.