Maximise your R&D claim – book a meeting
Overview
You’ve started doing R&D. You’ve spent money. You’ve got something to show for it.
Only problem? You hadn’t officially registered your company yet.
So now you’re wondering — can you still claim those expenses under the R&D Tax Incentive?
Let’s break it down.
First things first: the company must incur expenditure
The R&D Tax Incentive is for companies.
Not sole traders. Not partnerships. Not “ideas in a notebook.”
To claim, the company must legally exist and must be the one incurring the expense.
That means the company needs to be legally liable for the costs — not just reimbursing someone after the fact.
If you paid for something personally — before the company existed — that cost doesn’t count.
It’s harsh, but clear.
What if you reimburse yourself later?
Reimbursing yourself later doesn’t change when or how the expense was incurred.
If you personally paid for the R&D before the company was formed, it’s considered a personal expense — even if you loan the money to the company later.
To be eligible, the company must have incurred the expense itself — either by paying directly or by being legally liable under a contract at the time.
Not sure if your R&D spend qualifies?
Call Bulletpoint on 1300 658 508 and we’ll give you a straight answer.
What about early R&D after incorporation?
There’s a difference between early R&D planning and actual eligible expenditure.
If you built a prototype, paid for testing, or ran trials after incorporation — and the company was the one paying or contracting — then yes, those costs may be eligible.
But if it happened in your own name or ABN, it won’t qualify.
Can you transfer IP or assets into the company?
Yes, you can assign or sell IP into the company after incorporation — but this doesn’t mean the development costs before incorporation are suddenly eligible.
At best, you might be able to claim depreciation or future development costs — but the early expenses stay with the individual.
Common trap: the loan agreement workaround
Some directors try to use loan agreements to reimburse themselves for early R&D spend. Here’s why that doesn’t work:
If the company didn’t exist when the cost was incurred, it couldn’t have been liable for the expense — and therefore can’t claim it.
Let’s look at three common examples that fail the eligibility test:
Case Study 1: The pre-company prototype
Jack builds a working prototype in his garage and spends $8,000 on parts and testing — all in his personal name. Two months later, he sets up a company and has it sign a loan agreement to reimburse him.
Result: Not eligible. The company didn’t exist when the expenses were incurred and can’t retrospectively adopt the liability.
Case Study 2: The early consultant contract
Amira hires a software developer as a contractor using her sole trader ABN. Three months later, she sets up a company and enters into a loan agreement to repay herself.
Result: Not eligible. The original contract was between the consultant and Amira, not the company.
Case Study 3: The IP transfer
Carlos develops a tech platform while working as a freelancer. Once incorporated, he sells the IP to the new company for $1, but tries to claim the $12,000 of development costs via a loan agreement.
Result: Not eligible. Transferring IP does not make prior personal expenses R&D eligible.
Already spent money before incorporating?
Don’t stress – message Bulletpoint to find out what (if anything) you can salvage.
So what’s the best move?
If you’re planning to do R&D — set up the company early.
Even if the product isn’t ready, incorporation ensures all eligible R&D spend is in the company’s name and can be properly claimed.
Why Bulletpoint?
At Bulletpoint, we’ve helped over 500 businesses successfully claim R&D tax incentives — with over $100 million secured in funding.
We know the legislation, the fine print, and the traps that catch businesses out. And we’ll tell you upfront if something’s not eligible — no sugar-coating, no wasted effort.
If you want to
- Get your structure right from the start
- Avoid dodgy advice and claim only what’s legit
- Maximise your R&D refund with confidence
Then let’s talk.
Book a call or send a message.
It’s easier (and cheaper) to get it right the first time.
Thinking about using a loan agreement to back-claim process?
Call Bulletpoint now and avoid wasting hours (and cash).
FAQ
No — only expenses incurred after the company is incorporated and by the company itself are eligible. If you paid for R&D in your own name before the company existed, it’s considered a personal expense and won’t qualify under the R&D Tax Incentive.
Reimbursing yourself later (even with a director loan agreement) doesn’t make the cost claimable. The company must have been legally liable for the expense at the time it was incurred — not after the fact.
No. Sole traders and partnerships are not eligible R&D entities. If the R&D expenditure was incurred in a non-corporate structure, it cannot be claimed under the R&D Tax Incentive.
Transferring or assigning IP to the company may help establish ownership, but it doesn’t make the development costs incurred before incorporation eligible. You might be able to claim depreciation on the asset going forward, but not the original development spend.
Very rarely — and only if the company was formed under a valid pre-incorporation agreement where it retrospectively assumes legal liability. Even then, you’d need clear documentation and legal advice. For 99% of businesses, it’s a no.
An Australian-incorporated company is required — ideally with clean, separate accounting, IP ownership, and contracts. Getting this right early avoids messy claims (or rejected ones) later. Talk to us if you’re unsure how to set this up properly.