R&D Record Keeping & Compliance Workshops

R&D Tax Record Keeping

The ATO have stringent process and record keeping requirements for any software development work undertaken under the R&D Tax Incentive Scheme. 

The work needs to take a ‘scientific’ approach to the work. This is what the ATO are looking when they come and audit your work.

R&D Tax Incentive Compliance

To be compliant, the following is a list of what you must have documented, as well as processes to capture, on an ongoing basis:
  1. Your Product Strategy or Roadmap
  2. Why you needed to develop the software instead of buying it
  3. Capture lists of what New Knowledge is to be researched eg. algorithms, integrations or, APIs amongst others
  4. A hypothesis on how you will prove the accuracy of the new knowledge you discover
  5. Demonstrate what R&D you did
  6. Separation of Core R&D Activity, Supporting R&D and Supporting costs
  7. What ‘Experiments’ you are running to confirm your Hypothesis
  8. The outcome of the experiments, whether positive or negative
  9. Evaluation of the results and a determining of a new Hypothesis for the next iteration of your work.
Compliance is not only about the records you keep, but the language you use to express your IP and claim (it’s incredibly specific) as well as processes that must be demonstrable as part of any audit. This is code for ‘you can’t create the missing records retrospectively’. Softlogic can provide you with a tested and templated set of documents and ‘systems’ to put in place to give you comfort that the team is undertaking the work in a consistent way, following all necessary steps to keep your tax claim safe.

A 6-Step R&D Tax Compliance Framework

Over the years, we have worked with a variety of different businesses across manufacturing, software development and product design and development. Overwhelmingly the work revolved around managing the risk of non-compliance at audit resulting from lack of proper process, record keeping and language to document your hypothesis, tests and program of work that meets the ATO’s strict R&D requirements.
As a result we have developed a clear framework to ensure any R&D project is run in a way that both manages the risk of non-compliance with the ATO and ensure you are maximising the full extent of your IP.

Take the R&D Tax Self Audit Now and See how you stack up

Whether you are already submitting R&D Tax claims or investigating what is involved, we have prepared a survey that will allow you to let us know what documentation and record-keeping you are already keeping so that we can report back with how well we think you are doing. Take a new moments to complete it now. 
Explore our R&D Case Studies

R & D Record Keeping Workshops

We offer team workshops that will help your team to proactively review work to date as well as ensure all work going forward meets the stringent requirements from the ATO.

The workshop will cover:

  1. The complete compliance requirements – from processes to documentation
  2. Templates/ and wording (language) that needs to be used
  3. How to assess and document your upfront hypothesis
  4. How to record the results.

Your team will walk away with:

  • Prescriptive templates that give your team the ‘precise’ language and format needed to ensure a large team can be consistent and compliant. These are often sold for thousands of dollars but still lack the necessary ‘interpretation’ as it relates to your project.
  • A working knowledge of how to apply the templates to your project and how to show a scientific approach for your R&D project that shows a experimentation, iteration, and systematic progression to a conclusion that may or may not be fruitful, which is key to any successful R&D claim.
  • Discover Unexpected Windfalls When Reviewing Your R&D Tax Compliance where a better understanding of your IP as it relates to the scheme allows you to increase your claim. This usually arises in the workshop environment which allows your team the opportunity to discuss and explore the full extent of the R&D opportunities.
The workshops are a half-day, and we will use your project as the case study, so not only does your team have context with their training, but it also acts a ‘sense’ check that you’ve gotten your rationale correct.

Workshop outcomes

  • An aligned team on the process, language, and format of your project that fits with the R&D compliance requirements
  • A renewed and more in-depth understanding of what they can use the R&D for
  • A self-diagnosis and audit of how you are currently doing things.
  • Alignment of the slight variation or differences between team members that tend to creep in overtime.

R&D Tax Implementation Workshop Options

1 – Diagnostic Workshop

Develop a Implementation Strategy

  • Discuss existing Record-Keeping
  • Understand records information flow
  • Sector based knowledge/advice
  • 6-steps to improve Record Keeping
  • Potential claim improvements
  • Plan next steps

2 – Gap Analysis Workshop

Detailed Analysis with Gap Report

  • Includes Diagnostic
  • Review Product Strategy Records
  • Review Project Planning Records
  • Review Eligibility Criteria Records
  • Review Experiment Planning/Results
  • Review previous Claims
  • Review Core Activity cost tracking
  • Review Supporting cost tracking
  • Provide a Gap Analysis Report
  • Staff R&D Tax Information Session.

3 – Consistency Workshop

Prepare R&D Business Process Manual

  • Include Gap Analysis
  • R&D Process Training
  • Update process to match business workflows
  • Tailored R&D Templates
  • Prepare R&D Manual
  • R&D Manual Review workshop
  • Processes for each department
  • Recommend automation and tools

Optional Follow on Assurance Audits

Quarterly Review and Refinement

  • Meet quarterly to review records
  • Check Audit Survivability
  • Refresh Staff Training
  • Spot Check Records Compliance
  • Audit Specific Project Activities
  • Report compliance to the R&D Manual
  • Refine the R&D Manual