If you did R&D last financial year and your claim is still on the "later" list, this one's for you. Here's what has actually tightened in the R&D Tax Incentive, what's only proposed, and the simple moves that keep your FY26 claim on solid ground.

What's changed for the claim you're about to lodge

Most of the headlines this year were about the 2026 Budget. They matter, but they don't kick in until 1 July 2028, so they won't touch the claim you're lodging now.

1. The registration form got tougher. The department released a new R&D Tax Incentive application form in August 2025. It asks for more detail about your projects and activities, adds new questions, and gives you more room to answer. In plain English, more of the scrutiny now happens at the start, when you register, so your registration does more of the heavy lifting. A thin description that might have slipped through before is far more likely to raise questions.

2. Your application is now the main evidence. The department has moved to a risk-based approach, commissioning formal examinations where an assessor has eligibility concerns. This means the narrative in your registration carries more weight than ever. If your activities read like business as usual work, it's likely to catch an assessor's attention. Software and AI projects are under the closest watch, with new departmental guidance released this year, so if your R&D is software development, the bar for showing genuine experimentation is higher again.

3. Gambling and tobacco R&D is out. Parliament passed the exclusion in June 2026. It applies to income years starting on or after 1 July 2025, so it covers FY26 claims. It's narrow, but if your work touches either sector, check it before you lodge.

4. More compliance activity is coming. The 2026 Budget papers flag additional targeted ATO compliance activity over the next two financial years, including on the R&D Tax Incentive. The ATO has also warned businesses about cold callers and advisers pushing aggressive R&D arrangements. If a claim is overstated, the offset will have to be repaid, with penalties on top.

What's proposed, and why it shouldn't spook you

The 2026 Budget proposed the biggest R&D Tax Incentive changes since 2021, starting 1 July 2028. They include a higher offset rate for core R&D and removing supporting R&D expenditure from the incentive. They also lift the minimum annual R&D spend from $20,000 to $50,000, although smaller projects run through a registered Research Service Provider can still claim. We broke down the full list in our June post on the reforms (growology.com.au/blog/b/rdti-is-changing).

Two things to hold onto. They aren't law yet, and they don't touch your FY26 or FY27 claims. You have two full income years under the current rules. The smart move is to use them well.

Why timing matters more than most founders realise

The department publishes service standards for how long it takes to process registrations. Lodged within six months of year end: 20 business days (for a 30 June year end, that window closes on 31 December). Lodged six to ten months after: 80 business days. First-time registrants: 40 business days whenever they lodge. These are service standards for 95% of applications, not guarantees.

What this actually means: same R&D, very different experience. Lodge in December and your team still remembers what they tested and why. Leave it to April and you're chasing old timesheets in the busiest weeks of the year.

Five moves that keep your claim on solid ground

1. Lead with the uncertainty. Describe what you didn't know at the start and why existing knowledge couldn't answer it.
2. Show the experiment, not the product. Hypothesis, what you tested, what happened, what you changed.
3. Match costs to activities. Wages, contractor and materials costs need to line up with each activity, not just the project.
4. Keep evidence you made at the time. Dated plans, test results, version history, meeting notes and photos.
5. Lodge early. Get your FY26 registration in before 31 December if you can, and start compiling your FY27 records now.

Our approach is simple

We help you identify and claim everything you're genuinely entitled to, and make sure every documented activity stands up to scrutiny. Our role ends once your claim is successfully registered, but the ATO can generally review your files for up to four years, so it pays to have your ducks in a row from the start.

The order we suggest

Here's the honest version of what we see every week. The claims that cause the most stress aren't the ambitious ones. They're the ones lodged late, built from memory, with costs that don't quite line up.

So we work in this order. First, confirm the activity is genuinely R&D. Second, map each activity to its costs. Third, write the registration in plain company voice, not legislative jargon. Fourth, organise the evidence so it's ready if anyone asks. Then we set up next year's records, because the best FY27 claim starts now.

Grants and incentives aren't a side project. They're a growth strategy, and the R&D Tax Incentive rewards the businesses that treat it like one.

This article is general information, not tax advice. Talk to your accountant or tax adviser about your own circumstances.