The RDTI is administered jointly by AusIndustry (which assesses R&D activities) and the ATO (which administers the tax offset). Companies must register their R&D activities before claiming the offset.
Companies with aggregated turnover under the threshold generally access a refundable offset, calculated as their corporate tax rate plus a premium. Larger companies receive a non-refundable offset that increases with R&D intensity.
Registration of activities with AusIndustry has a firm deadline after the end of the income year, and it is separate from lodging the company tax return.
Who qualifies
- Companies incorporated in Australia (and some others) conducting eligible R&D activities.
- Smaller companies under the turnover threshold access the refundable offset.
- Eligibility depends on core and supporting R&D activities, not on sector.
Eligible activities
- Core R&D activities: experimental activities whose outcome cannot be known in advance, conducted for the purpose of generating new knowledge.
- Supporting R&D activities directly related to core activities.
- Eligible expenditure includes salaries, contractor costs, and other directly related expenses.
Typically not eligible
- Activities excluded by legislation, such as market research and some software for internal administration.
- Routine work with a knowable outcome.
- Activities not registered with AusIndustry.
How a claim works
- 1
Classify activities
Separate core R&D activities from supporting activities and confirm each meets the legislative test.
- 2
Keep contemporaneous records
Document the hypothesis, experiments, and outcomes as the work is performed.
- 3
Register with AusIndustry
Register the R&D activities within the deadline after the income year ends.
- 4
Calculate and claim the offset
Claim the refundable or non-refundable offset in the company tax return.
- 5
Prepare for review
Be ready to substantiate activities to AusIndustry and expenditure to the ATO.
What to document
- Records showing the experimental nature and unknown outcome of core activities.
- Links between supporting activities and core activities.
- Timesheets and cost records for claimed expenditure.
- Registration confirmation and technical descriptions.
Common pitfalls
- Missing the AusIndustry registration deadline.
- Blurring core and supporting activities.
- Claiming activities with a knowable outcome as experimental.
- Insufficient contemporaneous evidence for a review.
Questions to ask an advisor
- “How do you distinguish core from supporting activities under the current guidance?”
- “Do you manage the AusIndustry registration deadline for us?”
- “How do you substantiate activities to AusIndustry and costs to the ATO?”
- “What is your experience with RDTI reviews?”
Frequently asked
Is the RDTI refundable?
Companies under the aggregated turnover threshold generally receive a refundable offset; larger companies receive a tiered non-refundable offset based on R&D intensity. Confirm current rates with an adviser.
When must I register?
R&D activities are registered with AusIndustry, generally within 10 months of the end of your income year. Registration is separate from lodging the tax return.
Who administers the program?
AusIndustry assesses the R&D activities and the ATO administers the tax offset.