R&DTI Overseas Findings: Application Process and Practical Success Strategies

Overseas Findings Application Process

The overseas R&D findings process generally involves the following key steps:

1. Submit the Application

Companies must submit their overseas finding application through the R&DTI customer portal before the end of the income year in which the overseas R&D activities are conducted, or are planned to be conducted.

Late applications are generally not accepted, and extensions of time are not available for overseas finding applications. This makes early planning particularly important.

2. Prepare Application Materials

Companies need to provide complete technical documentation and supporting evidence, including R&D plans, activity descriptions, technical explanations, project timelines and budget information.

Insufficient documentation may delay the review process or weaken the evidentiary basis of the application.

3. Review and Communication

The Department of Industry, Science and Resources will review the application and may request additional information or clarification from the company.

During this stage, companies may need to explain the technical rationale, the relationship between Australian and overseas R&D activities, and why the overseas activities are necessary for the project.

4. Finding Outcome

At an application level, the outcome may be that:

• All activities are found eligible
• Some activities are found eligible and others are found ineligible
• The activities are found ineligible
• In some circumstances, the department may refuse to make a finding

Once the review is complete, the department will issue formal notification to the company and provide a copy to the Australian Taxation Office.

An overseas finding is a legally binding decision on the eligibility of overseas R&D activities. However, a positive overseas finding does not remove the need to substantiate the eligibility of related expenditure when claiming the R&D tax offset with the Australian Taxation Office.

Key Strategies for a Strong Overseas Finding Application

In practice, the overseas findings process can be viewed as a form of preliminary review of R&D activities. Because an overseas finding is a legally binding decision on the eligibility of overseas R&D activities, the application generally requires a higher level of technical detail than a standard annual R&DTI registration.

Based on experience with past projects, the following strategies are particularly important.

1. Design the Project Structure in Advance

Before applying for an overseas finding, companies should have a clear R&D project structure, including:

• The specific R&D activities involved
• The locations where each activity will be carried out
• The technical relationship between Australian and overseas activities
• The overall project timeline
• The expected project budget

In practice, submitting project plans, timelines, technical records and R&D evidence as attachments can significantly improve the completeness and clarity of the application.

It is especially important to explain why the Australian R&D activities cannot achieve the intended outcomes without the overseas activities.

2. Prepare for Ongoing Communication

Overseas finding applications often require multiple rounds of communication with the department or its representatives.

Application materials should therefore be:

• Logically organised
• Technically thorough
• Clearly structured
• Professionally presented

Companies should also be prepared to provide additional information, technical explanations or supporting evidence during the review process.

3. Provide Evidence That the Activities Cannot Be Conducted in Australia

This is one of the most critical requirements for overseas findings.

Companies must demonstrate why the relevant overseas R&D activities cannot be conducted solely in Australia. Examples may include:

• Lack of required facilities, expertise or equipment in Australia
• The need to access a specific population not available in Australia
• The need to access particular geographical or geological features
• Circumstances involving biosecurity or quarantine restrictions
• The absence of necessary environmental or testing conditions in Australia

It is important to note that cost alone is not sufficient. The fact that overseas activities may be cheaper than conducting similar activities in Australia does not, by itself, justify an overseas finding.

In practice, companies often consult Australian research institutions, industry experts, suppliers or technical service providers to verify the lack of suitable local resources. These materials can then be included as supporting evidence in the application.

4. Prepare a Detailed and Reasonable Budget

Budget planning is particularly important for overseas findings.

The overseas expenditure must be less than the expenditure on the related Australian core and supporting R&D activities conducted solely in Australia. Companies therefore need to carefully structure and document their project budgets.

Companies should:

• Estimate the expected costs of overseas R&D activities
• Identify the related Australian R&D activities and their expected costs
• Compare overseas expenditure with related Australian R&D expenditure
• Provide reasonable and well-supported cost estimates
• Keep evidence such as quotations, contracts, invoices or internal budget approvals

If quotations or signed contracts are available, including them can strengthen the evidentiary basis of the application.

Conclusion

For companies seeking to include overseas R&D activities within their R&D Tax Incentive strategy, successfully completing the overseas findings process is essential.

Understanding the eligibility requirements, planning a clear R&D structure and preparing comprehensive technical and financial documentation are often key to a strong application. Practical experience also shows that a well-prepared overseas finding application can not only support access to R&DTI benefits, but also enhance the credibility of the project with investors, partners and other stakeholders.

By learning from successful cases and adopting a systematic application strategy, companies can manage cross-border R&D activities more effectively and make better use of available policy support within their global innovation strategy.

If your company is planning overseas R&D projects or looking to optimise its R&DTI strategy, our team can assist with assessing project eligibility, developing application strategies and preparing the documentation needed to support a strong overseas finding application.