Research and development tax incentive

The Government has committed to raising New Zealand’s research and development (R&D) expenditure to 2% of GDP over 10 years.

To reach this target more businesses will need to increase their expenditure on R&D. This will be supported through an R&D tax incentive.

We listened to you and produced a user-friendly, fit-for-purpose scheme that will support a wide range of businesses to undertake more R&D.

Main features of the incentive

The main features of the R&D tax incentive include:

  • a credit rate of 15%
  • a $120 million cap on eligible expenditure
  • a minimum R&D expenditure threshold of $50,000 per year
  • a limited form of refunds for the first year of the scheme that will mirror the R&D tax-loss cash-out scheme run by Inland Revenue. A more comprehensive policy will be in place for the second year of the scheme
  • a definition of R&D that ensures the credit can be accessed more easily across all sectors, including the technology sector
  • the inclusion of state-owned enterprises, industry research cooperatives, levy bodies, and minority-owned subsidiaries of select Crown entities.

When the tax credit will apply

The 15% tax credit will be available from the beginning of a business's 2019/20 income year.

R&D Tax Incentive summary flyer [PDF, 91 KB]

The Taxation (Research and Development Tax Credits) Bill

The Bill to introduce the R&D tax incentive has been introduced to Parliament. Read the following related documents:

Policy changes from the discussion document

Briefing documents for download

  • Cover note for release of R&D tax incentive briefings 14 June – 29 August 2018 [PDF 217KB]
  • Approach to the R&D tax incentive bill (redacted) [PDF 71KB]
  • R&D Tax Incentive - Summary of Submissions (redacted) [PDF 1.5MB]
  • Report on UK and Norway R&D Tax Credit Schemes (redacted) [PDF 175KB]
  • R&D tax incentive for implementation (redacted) [PDF 181KB]
  • R&D Tax Incentive Support for loss-making firms and transition arrangements (redacted) [PDF 118KB]
  • Cabinet paper R&D tax incentive for implementation (redacted) [PDF 109KB]
  • Options to expedite transition of Growth Grant customers to R&D Tax Incentive (redacted) [PDF 102KB]
  • R&D Tax Incentive Extensions to Growth Grant contracts (redacted) [PDF 71KB]
  • R&D tax incentive for implementation cabinet paper (redacted) [PDF 321KB]
  • Science and Innovation Briefings on the R&D Tax Incentive, 2 November 2017 – 15 May 2018 (redacted) [PDF 6.9MB] - NEW

Submissions

Matrix of Submissions [XLSB 16KB] - ADD LINK TO THESE SUBMISSIONS IN  HAVE YOUR SAY

  • Submissions 001-026 (redacted) [PDF 15.6MB]
  • Submissions 027 - 036 (redacted [PDF 8.9MB]
  • Submissions 037 - 059 (redacted) [PDF 6.7MB]
  • Submissions 060 - 089 (redacted) [PDF 5.3MB]
  • Submissions 090 - 108 (redacted) [PDF 4.3MB]
  • Submissions 109-135 (redacted) [PDF 13MB]
  • Submissions 136 - 167 (redacted) [PDF 762KB]
  • Submissions 168-199 (redacted) [PDF 13MB]
  • Submissions 200-233 (redacted) [PDF 6MB]