Accounting and Business Advisory firm William Buck is bolstering its support of local SMEs undertaking Research & Development (R&D).
William Buck’s Adelaide-based R&D Grants and Incentives team has been expanded to assist local businesses investing in new products and services to identify and source potential funding support.
“We see our role as helping South Australian SMEs invest in R&D with greater confidence,” William Buck’s Head of Tax, Mr Andrew Nicola said.
“In response to growing client interest, we have expanded our R&D Grants and Incentives division. It will be headed by Matthew Cliff, who joins us with more than 10 years’ experience having worked both with the industry regulator and as an advisor.
“R&D is a key growth driver, not just for the individual business but the entire State economy. However, the development of a new product or service can be a challenging time for any business in any industry.
“SMEs must invest significant time and resources during the process so it’s important they are aware of the potential tax incentives that may be available. The R&D tax incentive can be significant and, in the current economic climate where every dollar counts, it’s an avenue worth exploring.”
William Buck’s expansion comes as a recent legal ruling creates additional confidence for SMEs when investing in innovation and claiming the R&D tax incentive.
In a decision that has significant implications for all industries, a Federal Court ruling on the 25th of July clarified that the use of existing technologies in a new way or location can constitute R&D activities, reducing a conflict point for new technology and product trials.
The Full Court decision in the Moreton Resources Ltd vs Innovation and Science Australia case broadens the interpretative scope of “core R&D activities” – particularly for “experimental activities”.
According to Mr Cliff, South Australian SMEs accessing the Australian R&D tax incentives program can now do so with more confidence.
“In the past we have observed that the use or application of existing technologies, albeit in a new context such as in a different location or purpose, may not constitute ‘new knowledge’ and therefore not be considered eligible,” Mr Cliff said.
Whilst this ruling was delivered in the context of an oil and gas mining operation, it’s a welcome outcome for all R&D claimants in SA regardless of industry or project type. It provides greater clarification on issues that have previously confused claimants, especially those in the agricultural and technology industries.
There are, however, still important requirements and criteria that must be met to access the R&D tax incentive and obtaining professional advice remains a recommended step in successfully navigating the system.
Under the current Federal Government program, companies can offset the costs of developing new products, processes and services through tax offsets. Eligible entities with an annual aggregated turnover of less than $20 million may be eligible for a 43.5% refundable tax offset on eligible R&D expenditure. For those with an aggregated turnover greater than $20 million, it is a 38.5% non-refundable tax offset on eligible R&D expenditure.