• p. 02 9810 7211

MJA Updates

Moreton Resources: More Good News For R&D Taxpayers From The AAT (Before The Curtain Falls)

December 19, 2022 Kris Gale

Whether your streaming tastes are related to the Addams Family, the Royal Family (or neither), you tune in knowing that the show won’t be going on forever. And so it is with the Administrative Appeals Tribunal (AAT) which the Federal Government has announced will cease after more than 50 years of operation next year.

However, there has still been time for some more good news to emerge from the AAT regarding the pivotal matter of the R&D Tax Incentive (RDTI) claims of Moreton Resources with the AAT releasing the following decision in recent times:
Moreton Resources Ltd and Industry Innovation and Science Australia (Taxation) [2022] AATA 3804 (21 September 2022)

The Federal Court of Australia (FCA) sent this matter back to the AAT in 2019 after Moreton Resources successfully appealed the AAT’s original decision that none of the claimed activities were eligible R&D activities.

On 21 September 2022, the AAT found that, except for 3 activities, Moreton’s activities in the 2012, 2013 and 2014 years supported Core R&D activities Moreton conducted in 2010.

In handing down its decision, the AAT has reinforced widely-held interpretative positions on some critical aspects of the RDTI, rejecting the attempted narrowing of the program implicit in the IISA’s arguments. This is good news for R&D taxpayers and provides additional support to the approach taken by MJA in preparing claims since 2011.

The decision has some very pertinent commentary on the meaning of the concept of ‘directly related’ in the definition of Supporting R&D Activities in the legislation. It states that a close and direct relationship is required between the related Supporting R&D Activity and the carrying on of a Core R&D Activity. To determine whether the relationship is satisfactory requires a holistic assessment of all the circumstances of a particular case. Importantly, the decision goes on to say that close proximity in time and/or location are not determinative criteria, just simply indicators to be taken into account.

There is further discussion regarding the meaning of dominant purpose and the operation of section 355-25(2)(f), the exclusions clause relating to environmental standards. MJA has approached these requirements in exactly the same way as set out by the AAT since we commenced preparing compliance claims in 2011.

Should you wish to discuss this matter please do not hesitate to contact Kris Gale on 02 9810 7211 or email kris.gale@mjassociates.com.au

Closer To Home

We are thrilled to announce that Vicki Meintjes and Craig Bryant have been appointed Senior Consultants in our team. This is the direct result of some stellar work performed by Vicki and Craig in recent years. And just this month, we have welcomed Aki Ueda to the fold. Aki has direct experience with both R&D in the lab and with financials on spreadsheets so he is an exciting addition to our skill set.

MJA would like to thank our clients and our professional colleagues, both public and private, for an exciting and stimulating year which has seen the fundamental value of the RDTI in underpinning Australia’s innovation effort very clearly spelled out.


May we take this opportunity to send everyone our best wishes for the Christmas season and our hope that 2023 proves to be a very successful year for us all!

Keep informed

MJA updates keep you informed on how government decisions will effect your business. This is a must if you want to know the latest on business and company insights without having to read and decipher complicated law and tax manuscripts.

* indicates required