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The aim of the R&D loss tax credit is to allow start-up companies (with an R&D focus) to refund tax losses caused by qualifying R&D expenditure.

To 'cash out' any tax losses from R&D expenditure you must meet the eligibility criteria.

To be eligible the company must:

  • be a tax resident in New Zealand
  • have a net loss in the corresponding tax year
  • have eligible R&D expenditure for the income year
  • have sufficient R&D wage intensity
  • meet the corporate eligibility criteria
  • own (solely or jointly) the intellectual property and know-how that results from the R&D activity.

Groups of companies

If you meet the criteria listed above and you are part of a group of companies you may still be eligible. 

  • The group as a whole must be in a tax loss position. 
  • The R&D wage intensity threshold must be met by the group as a whole. 

R&D wage intensity criteria

Meaning of R&D group

Group of companies definition

Ineligible entities 

Your company is ineligible if it is:

  • treated as a resident of a foreign country or territory under a double tax agreement
  • a look-through company
  • listed on a recognised exchange, for example, a stock exchange
  • 50% or more of the shares in the company are owned by anyone or a combination of, a
    • a public authority 
    • local authority
    • crown research institute
    • state enterprise
  • established by or subject to:
    • the Education Act 1989
    • the New Zealand Public Health and Disability Act 2000
    • the Crown Entities Act 2004