With the whole world experiencing the effects of the coronavirus pandemic, the Federal Government of Australia has been doing everything they can to cushion the financial impact on affected businesses.
In addition to this, Carbon are encouraging businesses to boost their capital by applying for R&D finance if they are eligible for the R&D tax incentive.
If you haven’t heard of the R&D tax incentive yet, it is a designed and implemented by the government to empower Australian businesses and business owners as well as drive innovation by providing a reward for those who spend time and resources on eligible R&D projects.
Check out some of our tips on how you can beat the capital crunch and how the R&D tax incentive can help.
R&D tax incentive
The R&D tax incentive can give your business a refund of up to 43.5% of the total expenses that you have incurred on research and development if your business is found to be eligible for the program. Hugely beneficial during these current times, and you can use the refund to soften the impact of your other expenditures during the coronavirus pandemic. Unsure if you’re qualified for the R&D tax incentive? Ask yourself the following questions:
- Did you carry out a scientific experiment?
- Did you try to achieve something unknown?
- Did you try to solve a technical problem?
- Did the experiment utilise a scientific method?
- Was generating new knowledge the purpose of the experiment?
- Did you aim to create new or improved materials, devices, products, services or processes beyond what is available?
- Did the experiment involve a technical risk or an unknown outcome?
- Is the outcome you are seeking unavailable on a commercial basis?
- Is there a risk that the experiment may fail to produce the outcome you are hoping to achieve?
If you answered yes to any of the questions above, your business may qualify for the R&D tax incentive.
Rather than waiting until the end of the tax year to lodge your claim and receive the R&D tax refund, you may be eligible to apply for the funding up front. A great way to boost your capital during these harder times. Carbon have recently partnered with Radium Capital to provide our clients easier access to their qualified R&D refund with an R&D advance. Speak to our specialist on how we can help you file your claims or learn more about your eligibility.
Reduce your tax bill
The government has also proposed additional programs to assist businesses with their tax bills to ease the impact of the coronavirus.
Instant asset write-offs
This gives eligible businesses the ability to write off the cost of a second hand or newly acquired asset immediately, up to a certain amount after which you can claim a tax deduction for the cost of purchasing said asset in its first year of use or installation. This could be used in conjunction with the R&D tax refund, if the assets were used for the eligible R&D project. Check out what documents you might need in filing for a claim here.
With the coronavirus pandemic, the government has decided to give the instant asset write-offs a rework; from 12th March to 30th June 2020, the threshold of $30,000 for assets has been increased to $150,000 for small business owners.
R&D tax incentive deadline extension
Due to recent bushfires and the coronavirus, the Federal Government has provided an extension to the deadline for claiming your R&D tax incentives for the year 2018-2019 to 30th September 2020. Be sure to lodge a claim for the R&D tax incentives that your business is eligible for by 30th September.
During these times, ensure you reach out and make use of whichever assistances are available to you. If you need a team to help you understand what benefits you are eligible for, how your business can bring in additional capital or how you can apply for government assistance, get in touch with us and we would be more than willing to help you out. Contact us on (08) 6381 2404.