R&D Tax Incentives and Government Grants for Your Business


R&D Tax Incentives and Government Grants for Your Business

Most businesses are based, either consciously or subconsciously, on the Greek philosopher Plato’s statement indicating that necessity is the mother of invention. You identify a need and then invent a product or process to fill that need.

It sounds easy enough, but the reality of getting your product or process to the marketplace in today’s society often involves complicated and lengthy research and development, and all that R&D can result in a hefty financial burden for you and your company.

Some of that burden can be can be eased by recruiting private investors and financial partners. There is, however, another avenue every business owner should make a point of pursuing but which is often overlooked.

That avenue is assistance from the Federal Government, which can be pursued in two different forms: Tax Incentives and Government Grants.

R&D Tax Incentives

Today’s world moves quickly. Innovation keeps that momentum going, and innovation is the driving force behind the Research and Development (R&D) Tax Incentive. Businesses which employ R&D processes can be rewarded with tax offsets.

To be eligible for the R&D Tax Incentive, you'll need to be able to show that your company's R&D includes experimentation of some type. If your development team is trying different processes or materials, or creating models or prototypes, your company may very well be eligible for one of the available tax offsets:

  • 45% Refundable Tax Offset

To be eligible for this incentive, a business must have an annual aggregated turnover of less than $20 million, and must not be controlled by an income tax exempt entity (or entities). This tax offset is equal to a 150% tax deduction for your company.

  • 40% Non-Refundable Tax Offset

All other eligible business entities may qualify for this tax incentive, which equals a 133% tax deduction. Additionally, unused offset amounts may be able to be carried forward to future income years.

As you might expect, acquiring these tax incentives for your business isn't easy. You need to know what expenses are and are not eligible; you need to know when to file your application, and you need to know which records you need to keep and which ones aren't necessary.

If your company qualifies for these tax incentives and you aren't taking advantage of them, you are short-changing your efforts for success. But there's no need to do that! Our R&D specialists can help guide you through the entire process to ensure you claim every dollar you and your company are entitled to.

Government Grants for Businesses

In addition to tax incentives, the Federal Government also has a surprising number of grants and assistance programs available to help businesses thrive.

There are several ways to find out what grants and assistance programmes your business qualifies for. The following are two very important resources, which can be searched in different ways, to help you get started:

Or, if you’d prefer, simply contact us and we’ll help you find the grants that best fit your situation and are most worth applying for. Remember, grant applications don’t always result in grant awards, but the only way to get grant funding is to apply for it so don’t let the opportunity get away from you.

New Start-up Investment Tax Incentives

In March new Start-up investment tax incentives were introduced to Parliament and are considered the 'world's most generous'. Although this has not yet passed through parliament, the incentives will create an early stage investor regime that provides tax incentives for qualifying investors. Those that will be relevant to our clients include:

  • A non-refundable tax offset
  • Capital gains tax exemption on innovation-related investments

We will update you as the bill progresses in Parliament.

Employment Incentives for employing mature aged workers

Employees are an investment for any business. Hiring a mature aged worker can be a great investment, bringing many years of experience and knowledge. And the government wants to help you too with the “Restart Programme”. The Programme is an Australian Government wage subsidy that encourages businesses to employ mature age workers who are 50 years or older.

The Restart wage subsidy is a payment of up to $10,000 (GST inclusive) if you employ eligible mature age job seekers for 12 months or more. Refer to the Government’s website for further information.  https://www.employment.gov.au/restart-help-employ-mature-workers-0

Get Your Piece of the Free Financial Pie

You’ve put a lot of time, effort and money into your business. With a bit more effort, you could be putting less money into the business while seeing greater results.

Applying for government grants and tax incentives can be time intensive and confusing for many, but that’s why we’re here. We are here to guide you through it all step by step and make sure you don’t stumble along the way.

Contact us to discuss your needs and how we can help you and your company find your way to a bigger and brighter future through the use of government grants and tax incentives. They’re giving this stuff away and it’s yours for the taking. Let us help you get your piece!

Any further questions? Please contact SMART Business Solutions on 0359 11 7000 or reception@smartbusinesssolutions.com.au and we can discuss whether your business may be eligible for any of these incentives.

Want to grow your business & improve cashflow?

You need SMART solutions for YOUR business, not just annual tax compliance! Get the SMART team working with you. Call SMART Business Solutions today on 03 5911 7000

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