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Understanding the New AusIndustry Review Approach for R&D Tax Incentive Claims (2025 Update) | Link R&D Advisory

You are here: Home Practical Reflections DISR Review UpdateUnderstanding the New AusIndustry Review Approach for R&D Tax Incentive Claims (2025 Update)

In July 2025, the Department of Industry, Science and Resources (DISR) announced significant updates to how R&D Tax Incentive (RDTI) claims are reviewed. The changes aim to remove duplication, shorten processing times, and focus compliance activity where eligibility risks are highest. For businesses, this means fewer touchpoints with DISR, but higher expectations for the quality and accuracy of the information submitted in the registration form.

Why the review process is changing?

DISR’s decision follows feedback from industry and findings from the Administrative Review Tribunal that previous processes could be confusing, duplicative, and slow. Businesses often found themselves responding to multiple requests for similar information or waiting months while their applications sat “in review.”

From 1 July 2025, DISR have determined to progressively implement a streamlined, risk-based model that aligns more closely with its service-level agreements and introduces a clearer distinction between low-risk and high-risk claims.

Key updates from 1 July 2025.

More effient, risk-based examinations. DISR will limit formal examinations to cases where eligibility risks appear highest, reducing unnecessary or overlapping requests for information.
Faster decisions and shorter review times. Applications will no longer be held “in review” before registration unless clear eligibility concerns exist, enabling faster registration decisions.
Removal of informal education and integrity visits. The former “Integrity Framework” programs (where AusIndustry conducted informal education visits or early-stage risk checks) have been discontinued. These sessions were once useful for guidance but are being replaced by direct assessment pathways.
Greater reliance on the form itself. In some cases, DISR may finalise an assessment using only the information provided in the R&D application form. This places increased importance on complete, evidence-based and well-structured responses within the form.

These reforms are designed to deliver earlier certainty for compliant companies, but they also heighten the need for accurate, defensible registrations supported by sound documentation.

How reviews now occur in practice.

The R&D Tax Incentive is jointly administered by the Australian Taxation Office (ATO) and DISR. Each focuses on different parts of compliance:

ATO-initiated reviews usually stem from financial anomalies such as mismatched claim amounts, unpaid associate expenditure, debt positions, or discrepancies between the R&D schedule and the company tax return.
DISR (AusIndustry) reviews are more commonly triggered by issues within the registration form, like unclear or incomplete activity descriptions, indicators that the work was commercial rather than experimental, or missing statutory elements such as whether “the outcome could not be known in advance.”

DISR reviews can occur before registration (pre-registration) or after registration (typically following an ATO referral). Technically, any income year can be examined, but in practice the scope is usually the four most recent years, or longer if an ineligible activity carries forward.

What these changes mean for R&D entities.
The streamlined model reduces administrative delays, but it also shifts more responsibility onto companies to substantiate their claims upfront. With the removal of informal education visits, there are fewer opportunities to clarify intent after submission.

At Link R&D Advisory, the R&D Technical Reports prepared with each client are designed to be the primary document supporting a claim. They detail what occurred on the ground (the actual experiments, tests, and technical challenges) and align these directly with the legislative framework. Our focus is always on structuring claims around genuine experimental work and ensuring every activity can be substantiated through contemporaneous evidence.

If a company can clearly demonstrate that its activities sought to generate new knowledge not known or deducible in the field, and that documentation ties directly to expenditure, there should be no issue under the new risk-based model.

Practical guidance to prepare for potential reviews.

Maintain contemporaneous records linking each experimental step to objectives, hypotheses, and outcomes.
Ensure your registration form mirrors the technical aspects of your work.
Keep financial evidence (wages, materials, contractor invoices) clearly mapped and explained to R&D activities.
Retain documentation for five years from the date of lodging the company tax return.

These simple practices will help withstand both pre-registration reviews and any retrospective examination.

Further reading.

DISR R&D Tax Incentive Newsletter – June 2025

R&DTI Program Charter (business.gov.au)

ATO – Helping You Get R&D Claims Right

DISR (business.gov.au) – Recordkeeping for Eligibility

Closing note.
The introduction of streamlined reviews is a positive step for efficiency, but it also reinforces the value of disciplined documentation and credible claim preparation. At Link R&D Advisory, we focus on ensuring R&D claims are defensible, compliant, and reflective of real-world experimentation, connecting innovation to incentives with confidence and clarity.