R&D and Government Grants

Research and development (R&D) and other government incentives

There are currently a number of government financial assistance programs on offer that may be able to help your business if you are:

 
  • Developing and commercialising new products, processes and services;
  • Investing in plant and equipment to increase productivity, expand operations and improve competitiveness; and
  • Promoting goods and services to export markets.
Outlined below is a sample of the types of government funding initiatives that may be of relevance to your business.

R&D Tax Incentive

Have you recently developed a new product, process or service? Did this development require a testing, trialling or experimental process? If yes, then you may be eligible for a refund of up to 43.5% of the expenditure you incurred during development. For example, if your business spent $100,000 on eligible R&D expenditure and you have records substantiating the R&D activities, you could receive up to $43,500 back in cash through the R&D Tax Incentive.
 
Who is eligible? What can be included eligible expenditure?
  • Companies incorporated in Australia
  • Overseas companies who are Australian residents for tax purposes
  • Overseas companies carrying on a business in Australia through a permanent establishment
  • Trusts are not able to claim the R&D incentive
  • Salaries and contactor expenditure on R&D activities
  • Overhead expenditure related to R&D (e.g. rent and electricity)
  • Depreciation on plant and equipment used for R&D
  • Materials and inputs used in trials
  • R&D related travel, conferences and training
Key dates: R&D applications for R&D activities carried out in the year ended 30 June 2017 close on 30 April 2018. Where a company has a substituted accounting period, applications close 10 months after year end.

Future Industries Manufacturing Program (FIMP)

Grants of up to $500,000 are available to assist companies implement new manufacturing technologies that generate sustainable new local jobs, improve productivity and competitiveness and target new growth opportunities. Note this is a Victorian government incentive and applies to Victorian operations only.
 
Who is eligible? What are eligible projects?
  • Companies must be incorporated in Australia with a minimum of three years trading history
  • Trusts with a corporate trustee may also be eligible
  • The project must be based in Victoria
  • The business must have the ability to co-contribute $3 for every $1 granted
  • The total eligible project expenditure must be greater than $100,000
  • Purchasing and implementing capital equipment items
  • Manufacturing product and process improvements
  • Prototyping, evaluation and testing of new manufacturing products and processes
  • Supply chain capability development
Key dates: Applications are open on an ongoing basis.

Local Industry Fund for Transition (LIFT)

Grants of up to $2 million are available to support projects which create sustainable employment opportunities with a strong focus on creating jobs for ex-automotive workers.Note the LIFT incentive applies to specific Victorian geographic areas. 
 
Who is eligible? What are eligible projects?
  • Companies must be incorporated in Australia with a minimum of three years trading history
  • Trusts with a corporate trustee may also be eligible
  • Business must be located in Geelong, Melbourne’s North, Melbourne’s South East or Melbourne’s West
  • The business must have the ability to co-contribute $3 for every $1 granted
  • The total eligible project expenditure must be greater than $200,000
  • Purchase of equipment or machinery to assist business establishment or expansion
  • Construction or fit-out of a new building or extension to existing premises
Key dates: Applications are open on an ongoing basis.

Accelerating Commercialisation Grant

Grants of up to $1 million are available to cover eligible commercialisation costs for businesses to take novel products, processes and services to market interstate or internationally.
 
Who is eligible? What is eligible expenditure?
To be eligible for a grant, applicants must have:
  • A novel product, process and service that is past the R&D phase
  • Must not have made “first sales”
  • The ability to fund at least 50% of the project expenditure (i.e. contribute $1 for every $1 granted)
  • Annual group turnover of less than $20 million for each of the previous three financial years prior to applying
  • Operate in growth sectors including advanced manufacturing; food and agribusiness; medical technologies and pharmaceuticals; mining; or oil, gas and energy resources
  • Labour expenditure (salaries including on-costs)
  • Contractor expenditure
  • Plant expenditure
  • State-of-the-art manufacturing plants or pilot manufacturing plants
  • Prototype expenditure
  • Other expenditure including travel, training, intellectual property protection, licensing set-up costs and business development activities
Key dates: Applications are open on an ongoing basis

Export Market Development Grant (EMDG)

Who is eligible? What is eligible expenditure?
  • Income of less than $50 million in the grant year
  • Have incurred at least $15,000 on eligible export promotional activities
  • Have promoted the export of goods, most services, intellectual property and know-how
  • Hold principal status for the export business – this means that export sales are directly between the applicant and an overseas buyer
  • Marketing consultant expenses
  • Marketing visits expenses
  • Costs of providing free samples
  • Trade fairs, seminars, in-store promotions expenses
  • Promotional literature and advertising expenses
  • Overseas buyers expenses
  • Insurance of eligible intellectual property expenses
Key dates: The EMDG program for the 2018 financial year opens on 1 July and closes on 30 November. First time applicants can include eligible EMDG expenditure relating to two income years.

Let's discuss the opportunities 

Identifying and navigating the government funding opportunities available to businesses can be challenging. With our specialist guidance and strategic approach, we can assist you to identify and successfully access the most appropriate government assistance programs.
To find out more on how we can assist your business, please contact Tim Cheong or Kerry Hicks on the details below: 
Tim Cheong
Director
T: 03 9608 0157
E: timcheong@moorestephens.com.au       
Kerry Hicks
Associate Director
T: 03 9608 0188
E: khicks@moorestephens.com.au