R&D Tax Incentive:
Audit Preparation & Assistance
R&D Tax Incentive Audit Preparation and Remediation
Have you received a Request for Information (RFI) with a list of complex questions?
You have 30 days to respond with answers (on average 100-150 questions).
Has your R&D Tax Incentive application been flagged as At-risk?
If so, in most cases, you will be given 12 months to review and fix your records before AusIndustry conduct their complete audit program on your R&D program of work.
Understanding the legislation and applying it to work you have already completed can be difficult.
Failing the audit may result in having to repay the grant for both the current year and previous year claimed, plus a fine of up to 1.5 times your claim amount.
We can assist with making sure you can pass an audit and
resolve your at-risk issues!
What triggers an audit?
The government have made recent changes that make it mandatory to have the proper documents in place before completing your application form. When conducting their desk check of your claim they will be able to obtain a clearer picture of your ability to substantiate it.
A review and audit of your documentation may be triggered by:
- Routine desk-checking of applications
- Missing or incomplete information in your application form
- Unclear information that does not match end to end between questions
If your application is flagged for checking, you will receive an RFI and you are given 30 days to produce the records as evidence of your R&D claim.
Once this stage is complete you may be assessed as “At-Risk” and informed that you will be reviewed within 12 months and should address the deficiencies they have identified.
Help with review and remediation
Softlogic Solutions are R&D Tax Incentive implementation specialists who offer a comprehensive review of your R&D processes and documentation. We provide you with everything you need to know and do to prepare a response to your Request for Information, a full-blown audit or to resolve your At-risk status.
An audit review is in-depth and will cover:
- existing R&D Documentation Structure
- locating Product Strategy Documentation
- clarifying your R&D Process Framework
- review of your Work Management Tools
- assessment of your Work Breakdown Structure and Time Tracking
- brainstorming and workshopping to identify potential sourced of additional information
- verification of your R&D Document Repository
- review of your Apportionment of expenses
Get into the trenches with your team to help prepare
- We will work with your team to ensure that you have classified your core and supporting R&D activities correctly and check that you have aligned the new knowledge, hypothesis and experiment regime to the Government’s detailed requirements.
- We will probe for hidden evidence in emails, lab notebooks, minutes, reports, and word and excel documents.
- Then we will conduct remediation by using our Templates Pack to construct documents with as many details as possible. Although these will not be contemporaneous (written when the R&D was conducted), they will be structured so that AusIndustry can understand them and they will assist with the remainder of the review proces
What Our Customers Have to Say
George has systematized his successful process for maintaining compliance records into a framework that was easy for us to adapt and apply to our way of working.
With plenty of high profile businesses being audited and found coming up short due to record keeping, we are now sleeping easy that we will not be one of them.
Comprehensive document check and process review
We will review and help you align your documents to the letter of the legislation, ensuring you have in place:
- Product strategy with project roadmap and new knowledge assessed
- R&D project documentation with project hypothesis explained
- R&D project eligibility proof for core R&D activity documentation
- R&D project timelines, plans and budgets that have been monitored.
- R&D work records that track time and materials as core and supporting
- Experiment plans to prove hypothesis documented*
- Experiments conducted and evidence recorded with the results evaluated/reported*
- Minutes of meetings to formally evaluate results, correct, and iterate on the hypothesis
- Expense tracking down to the individual Core and Support R&D Activities for each project.
The areas marked with an asterisk* need to use scientific language, and we will provide you with the correct wording to ensure you pass the audit.
Audit Preparation Service Options
- Rapid Response RFI Review Service
- Comprehensive Audit Preparation
If you have received a Request for Information, you will only be allowed 30 days to gather and provide the appropriate information.
We offer a rapid response review and remediation service to:
- Perform an evidence probe workshop.
- Review the documentation for compliance.
- Provide templates to ensure language and structure are correct.
- Review your application of core and support R&D and the supporting hypothesis and experiments outlined to ensure they will pass the initial RFI.
- Work with you to rapidly complete the document for the R&D Project being reviewed by AusIndustry or the ATO.
- Assist with answering the questions from AusIndustry or the ATO.
- Review the results with your Tax Consultant to ensure consistency with the R&D Tax Claim for the year being reviewed.
- Ensure you pass the RFI and avoid triggering a full-blown audit.
If you have been given an At-Risk rating (or you want to be prepared), you will need to take action to update and ensure your records reflect the requirements of the legislation.
We offer assistance to make sure this is done quickly, correctly and comprehensively to ensure you avoid a failed audit review.
We will provide:
- Training for your staff
- Templates to apply to all of your documents in arrears and in the future
- Audit and review of your current program with a detailed checklist of work required to make your applications compliant
- Deep dive into core and supporting R&D work definitions
- Review of all realigned work.
(Includes Consistency Training Workshop Package)
- Address all items flagged, plus extensive review to ensure no further issues will be flagged during the audit, ensuring you pass the audit and avoid fines.
Get in touch to find out more !
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