To fund its projects, my company has been largely dependent on receiving a government grant called the R&D Tax Incentive. One of the first things I noticed about AnaeCo Ltd is that it isn't 'trading' like other businesses and that its main source of Income comes from the R&D Tax Incentive. I haven't come across this in anyone elses businesses as yet.
Here are some presumptions I have made:
- I gather from company's financial statements that they have to apply for the grant after the fact. That is, they have to fork out the money for their research and development work and then apply to be reimbursed.
- They make provisions for what they expect they are going to receive. I assume this has something to do with using accrual accounting.
- It appears as though this grant is partially not assessable. That is the company does not have to pay tax on this income as they have made various adjustments in their tax calculation detailed in the financial statements notes.
Here is a link I have found detailing the R&D Tax Incentive Program.
Has anyone else come across firms who are dong R&D work?
This is an interesting way to make money!
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