Company A spent $200,000 on its R&D activity this year, but made an overall loss of $300,000. The ATO will give a 15% rebate on the R&D activity, which is $30,000. It will also allow the company to cash in its losses at the company tax rate of 30%, up to the value of its R&D spend- so in this case 30% of its $200,000 R&D spend … [Read more...]
Made a profit more than the R&D spend
Company B invested $200,000 in R&D during the tax year. Company B is in profit, to the tune of $300,000. Its tax bill will be 30% per cent of that, which is $90,000. However the ATO will allow a 15% rebate as the R&D Tax Incentive. So 15% of the $200,000 invested in R&D is $30,000. That $30,000 comes straight off the … [Read more...]
Made a loss but less than the R&D spend
Company C spent $200,000 on its R&D activity in the year. Overall the company made a loss of $100,000 during the year. The ATO will allow the company an R&D rebate of 15% of the $200,000 spent on R&D, so $30,000. It will also allow it to cash in its losses on the $100,000 loss, which at 30 cents in the dollar is $30,000. So … [Read more...]
Made a profit but less than the R&D spend
Company D invested $200,000 in its R&D. It made a profit for the year overall of $100,000. Tax on that profit would usually be $30,000, at 30%. However the ATO will allow the company to offset its 15% R&D Tax Incentive against this. So 15% of $200,000 spent on R&D is $30,000. So the final figure is $30,000 tax payable on … [Read more...]