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      Innovating is hard. Especially when funds are tight.

      KPMG's R&D Incentives and Grants team assists you in funding your innovation and growth plans so you can reach your future faster.

      Organisations that invest in innovation, including research and development (R&D), can create returns for their business and assist in creating long-term value and competitive advantage for the Australian economy. KPMG’s R&D Incentives and Grants team has broad experience in helping companies access support through tax incentives, grants and other sources of funding. We can assist you to develop an enhanced innovation and growth program that leverages government support.

      Incentives and grants for innovation

      In the competitive world of manufacturing, business owners and executives are often frustrated by the speed of commercialising ideas. We use a practical and commercial approach, working with business to accelerate your business growth. Our team have worked within manufacturing and research organisations for many years and use their extensive experience, research and insights to develop methods and tools to simplify commercialising an idea. 

      Build it bigger, better, faster

      The faster you can develop and commercialise your ideas and bring them to market, the greater your competitive advantage and the more likely you are to be successful and grow your business and your market. Equally important is how you recognise, value and protect your valuable intellectual property (IP). 

      We can help you

      • increase the pace of innovation by increasing your innovation capacity and improving performance.
      • keep you and your teams aligned and solutions focused. 
      • identify collaborative research opportunities with universities and research service providers.
      • develop your innovation and IP strategy – boosting innovation and accelerating your organisation’s efforts to grow towards the future.

      Government incentives

      KPMG’s R&D Incentives & Grants team specialises in helping industry understand and access government incentives. 

      For instance, the R&D Tax Incentive is the government’s principal program to support businesses to invest in R&D. It provides R&D tax offsets over and above the applicable tax rate where the amount you receive depends on a range of factors (e.g. entity type, ownership and turnover, level and location of R&D being undertaken, etc.). As a result, the benefit could be as much as a cash refund of 43.5 percent on the eligible R&D spend through to an 8.5 percent tax credit where the business is large, and its R&D spend is low. We can help you understand and access this support, including for technology-based improvements to processes, products and services that are often overlooked as they occur outside traditional product development or R&D departments.

      Additionally KPMG can assist with advice and support in planning and applying for each of the following tax incentives:

      • Digital Games Tax Offset – from 1 July 2022, provides eligible games developers with a 30 percent refundable tax offset for qualifying Australian development expenditure.
      • The Hydrogen Production Tax Incentive – as proposed, will provide a AU$2 per kilogram refundable tax offset, for renewable hydrogen produced for up to 10 years per project, between 1 July 2027 and 30 June 2040.
      • The Critical Minerals Production Tax Incentive – as proposed, will provide a refundable tax incentive of 10 percent of relevant processing and refining costs for Australia’s 31 critical minerals for up to 10 years per project between 1 July 2027 and 30 June 2040.

      Industry incentives

      R&D incentives for agribusiness

       
      Are you maintaining adequate documentation to support the eligibility of your R&D trials? You often can't solely rely on existing production or operational systems to substantiate R&D intentions or the experimental nature of your activities.

      Ensure you are correctly applying the feedstock provisions to your unique situation. Consider if an adjustment should be made when crops, livestock, or materials are processed into products for sale during the course of R&D activities.

      Consider what an appropriate sample size for your R&D project should be and ensure there is a link between registered activities and the associated expenditure claimed.

      Download factsheet

      KPMG R&D Incentives and Grants Factsheet - Agribusiness

      R&D Incentives and Grants Service Factsheet
      Download factsheet

      R&D incentives for biotech, medtech and pharmaceutical

       
      Consider that costs associated with the protection of IP are not typically eligible R&D expenditure.

      You may be able to claim R&D expenditure on R&D activities conducted overseas but only after your application for Advance/Overseas Findings of eligible overseas activities has been approved by Innovation and Science Australia. You must justify the reason why the R&D activities cannot be conducted in Australia and this typically means demonstrating a lack of expertise, facilities or equipment in Australia but can also include specific populations overseas required for certain clinical trials.

      The R&D Tax Incentive can provide a refundable tax offset even when you have also received support in the form of specific government grant funding. However, it's worthwhile to understand the implications of the interaction between the funding, for example to understand whether a clawback adjustment is required.

      R&D incentives for energy and low emission technology

       
      It can be difficult to determine the extent of the eligible R&D activities in development and production environments – where the R&D ends and business as usual begins?

      The specific exclusion for exploration-type activities should be considered when undertaking R&D in a mining or prospecting context.

      Depreciation can form a large portion of R&D expenditure where heavy plant and equipment is involved. By developing a system for apportionment and adjustment of tax asset registers where required, these costs can be captured in a simple and traceable way.

      Download factsheet

      KPMG R&D Incentives and Grants Factsheet - Energy and low emissions technology (LET)

      R&D Incentives and Grants Service Factsheet
      Download factsheet

      R&D incentives for engineering and manufacturing

       
      Consider how core R&D activities are distinguished from routine engineering processes, and how well these differences are documented? It is important that you can substantiate the iterative and experimental nature of R&D activities with contemporaneous documentation.

      Consider how you will identify when R&D is completed during a production trial or site-based testing.

      If your R&D is directly or indirectly related to the production of goods or services, consider how this may impact on the eligibility of activities. You may need to consider the impacts of the 'dominant purpose' test in these circumstances and potential feedstock adjustments.

      Download factsheet

      KPMG R&D Incentives and Grants Factsheet - Manufacturing

      R&D Incentives and Grants Service Factsheet
      Download factsheet

      R&D incentives for resources and critical minerals

       
      It can be difficult to determine the extent of the eligible R&D activities in development and production environments – where the R&D ends and business as usual begins?

      The specific exclusion for exploration-type activities should be considered when undertaking R&D in a mining or prospecting context.

      Depreciation can form a large portion of R&D expenditure where heavy plant and equipment is involved. By developing a system for apportionment and adjustment of tax asset registers where required, these costs can be captured in a simple and traceable way.

      Download factsheet

      KPMG R&D Incentives and Grants Factsheet - Resources and critical minerals

      R&D Incentives and Grants Service Factsheet
      Download factsheet

      R&D incentives for startups

       
      A lean company structure and rapid prototyping means you might not be focused on preparing contemporaneous documentation or recording changes to your hypothesis or experimental outcomes. Consider how you and your team can use existing tools to document your R&D activities to ensure you claim every eligible dollar you can.

      As you move through Seed, Series A and Series B growth stages, investors will want confidence that you have a robust R&D Tax Incentive structure and claim process in place. Consider whether your record keeping practices meet the requirements and whether you and your team are up to date on the latest guidance. Do you need help with understanding the details of the program and are you confident your team understand the R&D criteria and level of documentation expected?

      We can also assist you with understanding how and when investor tax incentives might help you raise more capital faster.

      R&D incentives for technology

       
      Consider the distinction between the different aspects of the project (new development vs customisation vs configuration) and how different types of activities undertaken as part of your project are assessed against the R&D eligibility requirements.

      Consider how you can use existing development tools to better identify and document your R&D activities. Agile development and record keeping practices are great at reducing administrative overheads, but mean companies tend to keep less project documentation.

      Consider the internal business administration rule, specific to software and IT claims, which prevents companies from claiming the R&D Tax Incentive on activities that fall within this exclusion.

      Download factsheet

      KPMG R&D Incentives and Grants Factsheet - Technology

      R&D Incentives and Grants Service Factsheet
      Download factsheet

      Why choose KPMG

      KPMG's R&D Incentives and Grants team offers four strategic advantages.

      • Industry understanding

        Our team has decades of collective industry experience. We can assist you to prepare responses and secure funding from the most valuable incentive programs in Australia.

      • Specialist knowledge

        Our team features specialists with diverse technical knowledge and qualifications. It includes engineers, scientists, IT specialists, lawyers and accountants that understand your business and it’s competitive position. 

      • Regulator engagement

        Our regular contact with policy makers and program administrators keeps us at the forefront of the latest guidance and requirements and allowing us to provide valuable industry feedback.

      • KPMG’s local and global network

        Access our local capabilities such as financial modelling, tax structuring, government relations or even our high growth venture team. In addition, our global network means we can help you, wherever you are and wherever you want to go. 

      Insights

      Browse KPMG's insights and thought leadership below.

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      If you would like to know more about R&D Incentives and Grants, please leave your details below and a KPMG team member will contact you to discuss your enquiry further.