R&D Tax Incentive — Dos and Don'ts | Tobbie Capital Advisory
Most refused R&D claims fail on the same handful of avoidable errors. Here is the list — built from the rules AusIndustry and the ATO actually apply.
The Rules of the Road
R&D Tax — dos and don'ts.
Do
- Register your activities with AusIndustry within 10 months of financial year end (usually by 30 April)
- Document as you go — hypotheses, experiments, results, repository history, test records
- Keep payroll and contractor records mapping people to the experimental work
- Include failed experiments — the incentive rewards the attempt, not the outcome
- Work with your tax agent to align the R&D schedule with your tax position
- Support core activities with a technical narrative a reviewer could follow
- Get an eligibility review before spending, when choices about structure are still open
Don't
- Claim routine development — bug fixes, standard feature work, known-technology builds (TA 2017/5)
- Wait until after year end to reconstruct your evidence — retrospective documentation is the classic refusal trigger
- Claim expenditure without records — unsupported spend is excluded on audit
- Overstate the eligible percentage — inflated claims are the ones that get selected for review
- Let financing structures disturb who owns the R&D or the IP
- Assume success is required — it is not; but genuine technical uncertainty is
- Miss the registration deadline — there is no second chance for a lodged-late year
The pattern behind most refusals: activity that is real, but documented too late and claimed too boldly. Both are fixable before lodgement — impossible to fix after.
Next Step
Where does your record-keeping sit?
Free review — we tell you honestly whether your documentation would survive scrutiny.
