ATO throws JobKeeper spanner in the works for R&D tax claimants

The ATO has warned businesses will not be able to claim JobKeeper wages under their R&D tax incentive deductions, foreshadowing retrospective red tape.

Matthew Elmas 29 July, 2020

tax Director ID — ATO commissioner of taxation Chris Jordan. Source: AAP Image/Mick Tsikas.

Companies accessing the R&D tax incentive may be forced to amend their income tax returns to omit wages supported by the JobKeeper program, advisors have warned.

In the latest JobKeeper integrity push to emerge from the Australian Taxation Office (ATO), a draft determination was published earlier this week outlining a prohibition on deducting R&D salaries paid out under the $86 billion wage subsidy scheme.

This means employers will be unable to claim JobKeeper wages under the tax incentive, including in cases where employees spend only a portion of their time on eligible R&D activities, up to the total value of the $1,500 fortnightly payment.