Quarterly payments for R&D Tax Incentive progress to consultation

Plans are now progressing for the implementation of quarterly payments of the R&D Tax Incentive, to be accessible for each quarter commencing on or after 1 January 2014. In preparations, the Assistant Treasurer, the Hon David Bradbury and the Minister for Industry and Innovation, the Hon Greg Combet, have jointly released a public consultation paper on the design and implementation of the R&D quarterly credits.

The Government agreed to move to introduce quarterly credits for small and medium sized companies entitled to the R&D refundable tax incentive, after it was negotiated in the passing of the legislation in the Senate in late 2011.

R&D quarterly credits will be an opt-in element of the R&D Tax Incentive for companies with an annual aggregated turnover of less than $20 million. It will assist companies eligible for the R&D refundable tax offset to obtain the benefit of the offset on a quarterly basis during an income year, rather than waiting until an income tax return is assessed.

The purpose of this consultation paper is to provide interested parties with an opportunity to provide feedback on the proposed arrangements prior to the implementation of this measure.

AusBiotech will be making a submission this week and invites members who wish to contribute comment to contact Communications Manager, Lorraine Chiroiu or on (03) 9828 1400 by 30 August.

There are four questions in the consultation document:

1. Are the proposed arrangements for quarterly credit workable? What features are most useful or problematic? How might the arrangements be improved while appropriately managing risks to companies and the Commonwealth?

2. What type of guidance material or services would be most useful to assist companies to access quarterly credits and meet any associated obligations?

3. Do the proposed arrangements for quarterly credits create any problematic interactions with other taxation or regulatory arrangements? If so, what are these interactions and how should they be addressed?

4. Are there any other comments on the proposed arrangements for quarterly credits outlined in this consultation paper?

The consultation document can be found here.