Could your business be eligible for R&D tax credits?
If your business is coming up with new products or processes, or undertaking research that answers previously unanswered questions, it could be eligible for significant tax credits.
The Government’s research and development (R&D) tax incentive is a way to encourage spending on R&D, increasing it to 2% of GDP by 2027. That’s because the Government understands that creating new products and intellectual property can help make the New Zealand economy more resilient and improve our productivity and standard of living.
Some big benefits for eligible businesses
It’s well worth applying for R&D credits if you’re eligible; check using Inland Revenue’s eligibility tool, which you can find here.
Key features include:
A 15% tax credit available from the beginning of a business' 2020 tax year.
A minimum R&D expenditure threshold of $50,000 per year
A $120 million cap on eligible expenditure
A definition of R&D intended to ensure accessibility across all sectors
Refundability for businesses in loss or with more R&D credits than income tax liability, capped at an amount based on the labour-related taxes they or other companies in the same group pay.
What to do if you’re eligible
If you think your business is eligible, give us a call. We’ll help you register for the R&D tax incentive and apply to claim your tax credits.
There’s quite a bit of information-gathering required which we can walk you through, including providing records of R&D expenditure, losses and apportionment.
Don’t worry, we can work on your behalf to support your claims and help you get the maximum benefit for your business’s innovations.
