Are you a grape grower and wine producer or tax advisor who advises grape growers and wine producers on the R&D Tax Incentive? While most businesses and tax advisors do the right thing, the Australian Taxation Office (ATO) and Department of Industry, Innovation and Science (DIIS) has issued a warning to tax advisors who have been improperly advising businesses on the R&D Tax Incentive.
Some tax advisors are incorrectly advising grape growers and wine producers that the compulsory Wine Grapes Levy can be claimed as a tax offset under the R&D Tax Incentive. Businesses who claim this levy as a tax offset may face potential penalties and tax liabilities.
The levy can usually be claimed by a wine producer as an ordinary business deduction against the wine producer’s assessable income but cannot be used to claim a refundable or non-refundable R&D tax offset for the business.
Who to contact
The R&D Tax Incentive is jointly administered by the ATO and DIIS. Businesses who may be involved in such arrangements are urged to contact the ATO about the tax advisor and to make a voluntary disclosure or amendment to their tax return, or contact DIIS to amend or withdraw their R&D registration.