Australia and New Zealand both call their scheme the R&D Tax Incentive, and both reward systematic experimental work. The similarities mostly end there. The design of the benefit, the approval process and the calendar are different enough that a trans-Tasman company should plan the two claims separately.
Rate design: premium versus flat credit
New Zealand gives a 15% tax credit on eligible R&D expenditure, between NZ$50,000 and NZ$120 million a year; a company can apply to IRD for approval to exceed the cap. The credit is applied after imputation credits and before refundable credits, and unused credits can be carried forward if the company meets shareholder continuity.
Australia's offset is the company tax rate plus a premium. For a company with aggregated turnover under $20 million, it is the tax rate plus 18.5 percentage points, which is 43.5% for a base rate entity taxed at 25%. Because the offset replaces the ordinary deduction for the same spend, the gain over a normal deduction is the 18.5 point premium for a company that can use its deductions; a company with no tax to pay receives the whole refundable offset as cash. Larger companies get a lower two-tier premium.
Approval comes first in New Zealand
New Zealand asks for approval before the claim. Most claimants use general approval, which since 1 April 2025 is due by the last day of the third month after the end of the first income year: 30 June for a 31 March balance date. IRD says it cannot accept late applications. The alternative, criteria and methodologies approval, is due even earlier, six months before that year ends.
Australia has no pre-approval for an ordinary claim. The company registers its activities with AusIndustry within 10 months after the income year ends, and can choose to seek an advance finding if it wants certainty in advance. The first hard date therefore comes about seven months later in Australia than in New Zealand for a company whose year ends in the same month.
Refunds
Australia pays the refundable offset as cash to the extent it exceeds tax payable, for companies under $20 million aggregated turnover that are not controlled by exempt entities. New Zealand's refunds are narrower: since 2020-21 every claimant uses the broader refundability rules, under which a company in a tax loss position, or with surplus credits, can be refunded up to a cap based on labour-related costs.
Running both: an illustrative sequence
A hypothetical Auckland and Melbourne software group with 30 June balance dates might run its year like this:
- By 30 September: the New Zealand company files general approval for the year just ended.
- Through the year: both companies keep contemporaneous evidence of their own experiments, with time recorded by company.
- By 30 April: the Australian company registers with AusIndustry. Rand can draft that registration from GitHub, Jira, Linear and Notion records and Xero payroll for the team to review and an Expert Reviewer to finalise; the company declares and submits it.
- Each company's accountant then prepares its own country's return and R&D schedule or supplementary return.
If the Melbourne company relies on Auckland engineers for part of an Australian experiment, it must apply for an overseas finding before the end of the first income year in which the overseas work is done, and must hold the positive finding before it claims the offset on that spend. See also overseas contractors and the R&D Tax Incentive calculator.