The R&D Tax Incentive (RDTI): What you need to know.

The RDTI is a new approach to R&D funding in New Zealand. It's a tax credit that reduces the income tax your business needs to pay. It opens up opportunities to explore the unknowns in your industry to create new innovations.

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Introduction to the R&D Tax Incentive

The RDTI is a 15% tax credit on the money you invest in eligible Research and Development (R&D) in New Zealand. There are criteria and processes to determine whether the R&D you do is eligible. The 2019/2020 tax year sees the implementation of the first phase, with a more comprehensive system in place for 2020/2021.FIND OUT MORE IN THE GUIDE HERE

What is R&D and why do it?

R&D allows businesses to explore new ways to create competitive advantage - and can produce a range of results including new systems and processes, or innovations in products and technology.

R&D allows businesses to explore new ways to create competitive advantage - and can produce a range of results including new systems and processes, or innovations in products and technology. Find out the definition of the types of R&D that qualify for the RDTI.

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How the Government can support your R&D

A wide range of R&D support is available to New Zealand businesses, whether you’re just starting out or already a significant R&D investor. Explore some of the options available to help you achieve your innovation goals.
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What is the RDTI and is it right for me?

The RDTI is designed to encourage a wide range of New Zealand businesses to undertake more R&D. Businesses spending between $50,000 and $120 million a year on R&D may be eligible to claim, and businesses that spend under $50,000 per annum may still claim if they work with an approved R&D provider. There are also provisions for businesses wishing to spend more.
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What R&D activities are eligible for the RDTI?

R&D sets out to discover an unknown, bridging knowledge gaps to allow businesses to grow in new areas. There are clear criteria around what does and doesn’t qualify as eligible R&D for claiming the RDTI and these should be looked at in detail before launching a project.
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What R&D spend applies to the RDTI?

There are some rules around what types of R&D expenditure are eligible for claiming the RDTI.

There are some rules around what types of R&D expenditure are eligible for claiming the RDTI.

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How do I prepare to claim the RDTI?

You’ll need to set up some processes and parameters around the R&D activity you plan to do. You’ll outline what your objective is, and then by logging the R&D journey, including the costs as you progress, you'll create some of the evidence needed to satisfy Inland Revenue's record-keeping requirements. The RDTI is filed in myIR on Inland Revenue's website.
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What are the steps involved to claim?

The RDTI is a tax credit, so must be claimed through Inland Revenue as part of your income tax return. You’ll also need to file a separate R&D supplementary return. The process will be linked to your myIR account, so that it is easy to find and manage in one place. The process between the 2019/2020 tax year and the 2020/2021 year will vary, so make sure you familiarise yourself with the steps below.
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