Turning the tide on R&D Tax Incentive eligibility

A recent decision has been handed down by the Full Federal Court in the case Moreton Resources Limited v Innovation and Science Australia [2019] in favour of the taxpayer.

A previous AAT decision had determined that R&D activities registered by Moreton Resources Limited were not R&D activities in accordance with the legislation.  The R&D project related to underground coal gasification technology, and the recent decision was that the R&D activities were, in fact, in compliance with the legislative requirements associated with the R&D Tax Incentive.  The Full Federal Court judgement confirms that the definition of core R&D activities should be read more broadly than the previous decision by the AAT had suggested.

The ramifications of this decision should not be isolated to the resources sector, but are relevant to any business seeking to apply technology to new areas.

By Dave Corbin, Managing Director