RDTI in-year payments
Want cash during the year towards your R&D costs?
Use our quick checklist to see if RDTI in-year payments could be right for you
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If you’re confident that RDTI in-year payments will benefit your business, apply now. If you’re unsure, read on to find out more.
What are RDTI in-year payments?
RDTI in-year payments offer you the option of an interest-free government loan that can provide regular cash payments towards your R&D costs, starting in the same year as you conduct your R&D.
This will enable you to get support closer to when R&D costs are incurred, rather than waiting for your RDTI tax credit to be issued (which can only happen after you’ve submitted your income tax return, and your RDTI Supplementary Return has been finalised by Inland Revenue).
You can request up to 80% of the value of your expected tax credit for a particular income year.
Generally, the loan won’t need to be repaid until after your RDTI Supplementary Return has been finalised.
Who’s most likely to benefit from RDTI in-year payments?
Any business that has applied for the RDTI can apply for RDTI in-year payments. However, they are mainly designed for businesses that have no - or only partial - access to the other method of ‘in-year’ support offered by the RDTI.
If you’re a profitable business, you already have the option of using up to 100% of your anticipated RDTI tax credit for a given income year, to offset your provisional tax payments for that year.
This option isn’t available, or can’t be fully utilised, by the following businesses, who will benefit the most from RDTI in-year payments:
- businesses with no provisional tax to pay, such as start-ups and those operating at a loss
- profitable businesses whose RDTI tax credit exceeds any provisional tax due.
How do RDTI in-year payments work?
RDTI in-year payments offer you a loan to help support your R&D expenditure for a given income year.
If you have more than one General Approval application, you can include expenditure associated with each application on the same loan.
It will only be necessary to apply for the loan once per income year, but you will be able to request payments at up to 3 regular intervals.
Each payment will be based on actual, eligible R&D expenditure prior to the payment date.
The loan will generally become due for repayment after your RDTI Supplementary Return has been finalised by Inland Revenue, although a different repayment date may apply in some circumstances (see "When will I have to repay my loan?" below for more details).
No interest will be charged on your loan if it’s repaid on time.
How much can I get?
You can get up to 80% of the RDTI tax credit receivable on actual, eligible R&D expenditure per income year, after any amount you wish to offset against provisional tax has first been deducted.
We’ve provided some examples of loan payment calculations below.
What are the payment dates?
You can request up to 3 payments per income year.
The period for submitting payment requests for research and development (R&D) work done between April 1, 2022, and March 31, 2023, is now open. The first deadline for submitting payment requests under this scheme is June 30, 2023. To receive payment for your R&D credits starting from April 1, 2022, it is essential to submit your payment request before the June 30 deadline. For more information, please visit the website.
How do I apply for RDTI in-year payments?
RDTI in-year payments are managed and administered by TMNZ.
To apply go to the portal on the TMNZ website.
See “What will be involved in applying?” below for an overview of the application process.
How do I request a payment?
To request a payment, you need to submit a payment request ahead of the actual payment date.
You can do this via the “RDTI in-year payments” portal on the TMNZ website.
When do I have to repay my loan?
Your RDTI in-year payments loan will be due for repayment on whichever date below applies to you:
If you have filed your RDTI Supplementary Return by the due date
Your loan will be due on the earliest of the following dates:
- one month after Inland Revenue has approved or declined your RDTI Supplementary Return, or
- six months after the due date of your RDTI Supplementary Return.
If you have not filed your RDTI Supplementary Return by the due date
Your loan will be due one month after the due date of your RDTI Supplementary Return.
Working out what you can afford to repay
If you intend to apply for RDTI in-year payments, we recommend that you carefully consider:
- how you might receive your RDTI tax credit, i.e. as a cash refund and/or a tax credit, and
- how this could affect your ability to repay your loan.
This is because regardless of how you receive your RDTI tax credit, your RDTI in-year payments loan will become due for repayment on the applicable due date.
The sooner you apply for the RDTI, the sooner you can access RDTI in-year payments
If you want to access RDTI in-year payments, we recommend you submit your RDTI application as soon as possible after the start of your income year.
This is because:
- you must have submitted an RDTI application before you can apply for RDTI in-year payments
- you can't receive a payment until your RDTI application has been approved.
It's important to file your RDTI Supplementary Return on time
If you take out an RDTI in-year payments loan, it's important to file your RDTI Supplementary Return on time.
This is because no RDTI tax credit can be issued if you miss the RDTI Supplementary Return deadline.
RDTI Supplementary Returns are due within 30 days after the due date of your income tax return.
Filing your RDTI Supplementary Return on time will help avoid you being in a position where you have an RDTI in-year payments loan, but potentially no RDTI tax credit to offset the loan.