R&D Tax Incentive in the Organics Industry
For growers, producers, manufacturers and service providers within the organics sector, R&D is a familiar concept. Solving the diverse problems in growing, sourcing and delivering a genuinely organic product to consumers requires new thinking, and often doing things that have never been attempted before.
It is this shared challenge at the heart of organic production that makes innovation in the organics sector relevant to the R&D Tax Incentive. With increasing consumer demand for organic product and food provenance, the organics sector must lead the way, innovating to solve these other emerging challenges.
The R&D Tax Incentive exists to help eligible companies uncover new knowledge and address knowledge gaps on a global scale, for many innovators in the organics sector this is a daily challenge.
What is the Research & Development Tax Incentive?
The R&D Tax Incentive is an Australian Government Initiative administered by AusIndustry designed to encourage companies to conduct experimental R&D activities that might not otherwise be undertaken with a view to drive economic growth and international competitiveness.
Eligible companies can claim up to 43.5% of their expenditure associated with R&D throughout the financial year, either as a tax offset or cash refund. It’s not a grant, there is no ongoing reporting, no milestone payment conditions, nor KPI’s attached to the R&D Tax Incentive. If you’ve invested themoney on your R&D, you’re entitled to claim it!
Am I Eligible?
To be eligible for the R&D Tax Incentive, you must be a for-profit company incorporated in Australia and have at least AUD $20,000 of eligible expenditure on R&D activities. Your business can only benefit from the program if your innovation is considered eligible R&D andyou are creating genuinely new knowledge. Take our quick quiz to find out if you may be eligible for the R&D tax incentive.
How do I claim R&D?
The R&D Tax Incentive is claimed via an online lodgement with AusIndustry. Depending on the scope and size of R&D projects, businesses can prepare and self-lodge their claim or work with an R&D Consultant. The regulator recommends utilising the services of an R&D Consultant to assist in preparing and lodging claims and cut through any complexities.
Systems such as Synnch exist if you wish to self-lodge under a compliance framework or Synnch can introduce you to an R&D Consultant to closely support you whilst on your R&D journey.
Compliance is Key
In addition to eligibility, the R&D Tax Incentive comes with rigorous but achievable compliance requirements. In simple terms to be compliant, you are required to keep corresponding records of eligible R&D activity and expenditure as they are incurred – or otherwise defined as, contemporaneously.
Failing to ensure compliance is the most common cause of issues with the regulator. For many businesses, R&D is a part of everyday operations, so utilising a program like Synnch to integrate with your current business model is seamless and we support you at every step in the process.
Where do I begin?
Are you innovating? Do you want to be? Are you solving an industry problem that has never been attempted before? For many businesses in the organic sector, answers to these questions should come easily. If you think you might be eligible but have never claimed the R&D Tax Incentive; it could be a fantastic source of cash flow or capital to reinvest into innovation. Whether you are a grower, producer, manufacturer or service provider with the organic sector, innovation has to be at
the heart of what you do.