The Australian Government has outlined a proposal and produced an Exposure - Draft, for companies that are eligible for the 45% Refundable Research and Development Tax Incentive Offset, to receive their refund in quarterly instalments.

It will operate in a similar fashion to the Pay-As-You-Go (PAYG) Instalment System, whereby the quarterly instalments will be reconciled against the companies actual refund entitlements as part of their annual income tax assessment. The instalments will be calculated either:

1.  Based on the refund from the most recent income year; or

2.  A varied amount chosen by the taxpayer by estimating the refund for the current year. Unlike the PAYG instalment system you have to opt in to participate.