After market close on 24 February 2020, Australian heavy rare earths producer Northern Minerals (ASX: NTU) received formal notification from the Department of Industry Innovation and Science (AusIndustry) that it had reversed its initial findings in relation to the company’s research and development (R&D) claims. This means that most of the company’s registered activities are eligible for the R&D incentive.
AusIndustry review finds most activities in Northern Minerals’ R&D tax offset claims for FY17 and FY18 were in fact eligible
Australian Taxation Office to reassess income tax returns for FY17 and FY18
The company has agreed to exclude from the claim some minor supporting activities that were part of the previous claims.
AusIndustry will provide a copy of the notice to the ATO which is bound by AusIndustry’s findings and is expected to reconsider certain aspects of their initial finding before confirming the quantum of the final refundable R&D tax offset.
The Company will seek to immediately stop payments to the ATO of amounts owing as a result of the initial finding (refer announcement dated 5 June 2019) and work closely with the ATO to confirm the final refundable R&D tax offset.
Northern Minerals Managing Director and CEO, George Bauk, commented “We are pleased but not surprised by the AusIndustry review findings.
“The Company and its advisors worked diligently and submitted claims in respect to the R&D tax offset in line with the assessment criteria provided.
“We committed to initially developing Browns Range as a pilot plant operation as there were no analogues or peer projects to guide us.
“As such, we were always confident that our claims met both the spirit and technical guidelines for assessment.
“We look forward to working with the ATO to finalise this process.”