Guideline for Overseas Research and Development Activities

Innovation Australia's Overseas Research and Development Activities Guidelines commenced on the date of its notification in the Gazette, No. S 148, 13 May 2004. This Guideline set out in Schedule 1 replaces the Guidelines made under section 39EB of the Industry Research and Development Act 1986 on 15 February 1995.

The primary purpose of the R&D Tax Concession provisions relating to overseas R&D activities is to recognise that Australia does not have all the necessary R&D expertise and facilities to meet industry needs, and that Australian companies should not be disadvantaged in seeking world class R&D wherever it may be located.

An applicant may apply for a provisional certificate so that the applicant may make a claim under the R&D Tax Concession in respect of certain R&D activities conducted overseas if the applicant who proposes to undertake the activities meets the criteria set out in these Guidelines. 

An applicant is not eligible for the concession in respect of further actual expenditure above the 10% limit incurred on overseas R&D activities in connection with a project of R&D activities.

In order to claim the R&D Tax Concession in respect of R&D activities proposed to be carried on overseas, an eligible company must inform Innovation Australia in writing that it proposes to carry on those activities before it incurs expenditure in relation to those activities.

The new Guidelines came into effect on 13 May 2004. 

More detailed information can be found in the following:

• Guide to the R&D Tax Concession 2006;
• Section 73B of the Tax Act;
• Part IIIA of the IRD Act.

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