Updated November 12th 2013

Prior to the 2010 federal election the government announced changes to the treatment of Research & Development expenses for taxation purposes. These changes propose to give small to medium enterprises with turnover of less than $20 million 15c in the dollar for R&D spending while companies with turnover of greater than $20 million would receive 10c in the dollar. These changes were expected to be effective from 1 July 2010.

However, the legislation was delayed and since being reintroduced into parliament it appears the Senate will block the current proposal. This may result in the new laws not coming into effect until 1 July 2011. If your business currently claims an R&D tax benefit, it may be beneficial to review spending in the current year to determine how the proposed changes will impact your business.