Status: On 12 May 2009 the Government announced it will replace the existing R&D Tax Concession with a new R&D Tax Credit. The R&D Tax Credit will come into effect from 1 July 2010.
On 18 December 2009, The Treasury released an exposure draft legislation and explanatory materials for the new R&D tax incentive for public comment. Information can be found on the Treasury website.
Description: The new R&D Tax Credit is a broad-based and market driven incentive package. The two core components of the package are:
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a 45 per cent refundable tax credit (the equivalent to a 150 per cent concession) for companies with a turnover of less than $20 million per annum;
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a 40 per cent standard tax credit (the equivalent of a 133 per cent deduction).
The new tax credit is decoupled from the corporate tax rate and thereby creates certainty in the level of assistance to be provided.
An interim measure, prior to the introduction of the R&D Tax Credit, will increase the R&D expenditure cap for the R&D Tax Concession Offset from $1 million to $2 million for 2009-10. This demonstrates increased Government support for eligible small companies.
Information on the Government’s announcement of the R&D Tax Credit is available at the Minister for Innovation, Industry, Science & Research’s website www.minister.innovation.gov.au.
Information on the Government’s Innovation Agenda, Powering Ideas – An Innovative Agenda for the 21st Century, is available at the Department’s website www.innovation.gov.au.
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