Tech unicorn Atlassian reported $200 million in research and development (R&D) expenditure in 2021-2022, topping the Australian Taxation Office’s first public list of entities claiming the R&D tax incentive.
To increase transparency and encourage tax compliance, the ATO has committed to publishing data on firms participating in the R&D tax incentive program, which provides tax offsets to mitigate the cost of cutting-edge research.
The tax office published its inaugural R&D transparency report Thursday, showing 11,545 companies filed a total of $11.2 billion in R&D tax incentive claims across the 2021–22 income year.
Atlassian Australia 1 Pty Ltd topped the charts by claiming $200,460,127 in expenditure, some $70 million ahead of the next-biggest claimant, the biotech giant CSL Limited.
While the top 10 list is populated by some of Australia’s biggest companies, the report also details the R&D tax incentive claims made by small businesses, defined as entities with aggregated turnover below $10 million.
Of the $11.2 billion in total claims, some $2.2 billion were made by small businesses, showing the importance of the scheme for burgeoning enterprises and startups.
Their average claim was $395,191.
Small businesses made up 48% of the businesses that claimed R&D expenditure.
The report also details the sectors where R&D spending was most prevalent, giving a clear picture of where Australian industries are attempting to drive innovation.
Topping the list are businesses in the professional, scientific and technical services sector, covering a broad remit spanning scientific research to computer system design.
Some 43% of claimants came from that sector, accounting for $4.7 billion of reported R&D spending.
Next came manufacturing (21%), wholesale trade (5%), information media and telecommunications (5%), financial and insurance services (4%), with a combination of all other industries (22%) rounding out the total.
By publicly listing the amounts claimed, the ATO hopes to encourage compliance with the incentive’s rules.
The tax office has form in seeking compliance: Late last year, the ATO warned businesses and their tax advisers against seeking questionable offsets or inflating the value of their claims.
While transparency is clearly key to the ATO, how business entities invested in research and development is not listed in the report.
Nor is the actual amount of R&D tax offset received by any claiming entity.
“The delay in publishing this information is designed to address any perceived commercial sensitivity of the data,” the ATO added.
You can access the 2021-2022 report here, with further editions set to be published on an annual basis.
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Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
