ATO Transparency Report Shows Nearly $17 Billion Invested Under R&D Tax Incentive

The Australian Taxation Office (ATO) has released its annual Research and Development tax incentive (R&DTI) transparency report, showing that companies invested nearly $17 billion in qualifying research and development during the 2023–24 income year.

The newly published data covers 13,490 entities that claimed the incentive. According to the report, 51% of claimants were small businesses, 31% were privately owned and wealthy groups, 18% were public and multinational groups, and five were not-for-profit entities.

Public and multinational companies represented the largest share of financial investment, contributing $9 billion, or 54% of the total R&D expenditure. Privately owned and wealthy groups accounted for 28% of total spending. Small businesses with an annual turnover under $10 million recorded the largest growth, increasing their R&D expenditure by 28% to reach $3.1 billion.

By sector, the professional, scientific, and technical services industry recorded the highest overall R&D expenditure for the year, followed by the manufacturing sector.

ATO Deputy Commissioner Louise Clarke stated that publishing the report is a legislative requirement that enhances public accountability and encourages voluntary compliance.

"Transparency helps build confidence in the R&D tax incentive by showing the community where public support is being directed, while encouraging businesses to take care and ensure their claims are accurate," Ms Clarke said.

The R&DTI program operates under a self-assessment and self-registration model and is jointly administered by the ATO and the Department of Industry, Science and Resources. The ATO noted that it conducts reviews and audits to verify claims and utilizes systems designed to detect non-compliance within the program.

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