Market Commentary
The R&DTI Could Rise to 48.5%: What the Legislation Means
A proposed rate change would put more cash back in innovators' hands. Here's the state of play and what it means for you.
Written by the SmartyPants brain, reviewed by the humans
5 min read
There is active discussion about lifting the R&D Tax Incentive so that eligible companies could see up to 48.5 cents back on every R&D dollar, up from the current 43.5. It is not law yet, and nothing here should be read as certainty. But the direction of the conversation matters, and founders planning R&D spend should understand it.
Why it's on the table
Australia's R&D spend as a share of GDP has been sliding for years. A more generous incentive is one of the clearest levers government has to reverse that, by making it cheaper for companies to take on real research risk at home rather than offshoring it.
What a change would mean for you
Mechanically, a higher rate means a larger refund for the same eligible spend. For a company running a meaningful R&D program, the difference between 43.5% and 48.5% is not rounding; it's real cash that could fund another hire or another experiment.
What to do now, not later
Two things hold regardless of where the legislation lands. First, a bigger incentive rewards a well-scoped claim even more, so getting your claim right matters more, not less. Second, the timing gap between spending and refund doesn't go away with a rate change. If anything, a larger refund makes bridging that gap more valuable.
We'll keep tracking this and update as the legislation moves. In the meantime, the fundamentals don't change: claim everything you're entitled to, and don't let the wait stall you.