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Research and development tax incentive

We review behaviours of concern that result in incorrect Research and Development (R&D) tax offsets claims.

Last updated 30 April 2023

We review behaviours of concern that result in incorrect Research and Development (R&D) tax offsets claims.

R&D tax incentive administration

The ATO and AusIndustry (on behalf of Industry Innovation and Science Australia) jointly administer the research and development (R&D) tax incentive. The incentive aims to support companies that undertake eligible R&D activities. AusIndustry administers the registration and compliance of the R&D activities. We are responsible for the R&D expenditure claimed on the tax return.

We focus on claims:

  • made by entities in particular industries
  • related to particular behaviours.

Industries of concern

Four industries of concern have been identified:

  • agriculture
  • building and construction
  • mining
  • software development.

Particular behaviours of concern are:

  • claiming the R&D tax offset on business-as-usual expenses
  • apportionment of overheads between eligible and non-eligible R&D activities
  • payments to associates
  • whether or not expenses have been incurred
  • approaches taken by R&D consultants
  • fraudulent claims
  • failure to keep records.

Taxpayer alerts

For more information on the R&D incentives and industries, see our taxpayer alerts:

  • TA 2015/3 Accessing the R&D tax incentive for ineligible broadacre farming activities
  • TA 2017/2 Claiming the R&D tax incentive for construction activities
  • TA 2017/3 Claiming the R&D tax incentive for the ordinary business activities
  • TA 2017/4 Claiming the R&D tax incentive for agricultural activities
  • TA 2017/5 Claiming the R&D tax incentive for software development activities

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