R&D Tax Incentive correction – update

In the June edition we shared advice from Hort Innovation of a correction to the R&D Tax Incentive eligible levy rate previously provided in respect of the Olive Fund. The levy rate of 41% originally communicated was substantially lower than that which is actually applicable – 49.1%.

Given the deadline for claims of 30 April, and the additional expense of engaging a tax agent/adviser to submit a revised claim, the AOA requested confirmation around ATO acceptance of late, revised claims. Hort Innovation has provided the following information:

• The mechanism by which payments to RSPs (e.g. levy rates) are disclosed to the ATO is via the R&D Tax Schedule lodged as part of a company’s income tax return with the ATO, but only where the levy payer has lodged an R&D Application with AusIndustry.
• The R&D Tax Schedule does not directly reference levy rate changes. Instead, it reports a total dollar value of R&D expenditure, which may include amounts relating to RSP levy but only where the relevant levy payer has registered R&D activities in an R&D Application with AusIndustry. The applicable levy rates form part of the supporting calculations used to determine total R&D expenditure and should be retained by the taxpayer.

 The R&D Application lodged with AusIndustry, which has a statutory deadline of 30 April 2026 for taxpayers with a 30 June 2025 income year end, is used to register a company’s eligible R&D activities, not R&D expenditure (which is claimed via the company income tax return from the ATO).

• A change in the claim rate does not require a revision to the R&D Application, as the application relates to the registration of activities rather than expenditure.
• Income tax returns are not subject to the 30 April deadline and can generally be amended within four years from the date of the original Notice of Assessment.

Levy payers with any questions or requiring further information can contact [email protected]

The original article on levy-funded R&D eligibility for the FY2025 R&D Tax Incentive can also be found here.

This communication does not constitute financial, taxation or legal advice. Hort Innovation does not provide application services. Obtaining independent advice from qualified financial or professional advisors is strongly recommended.