Government support for automation R&D

A government tax concession has enabled Citect to pursue 'essential' research and development.

The R&D Tax Concession is designed to fuel local research and development and is available to all sectors of industry. Best of all, each company controls the direction of their R&D.

This means Australian companies are able to deduct up to 125% of eligible expenditure that is incurred on R&D activities from assessable income when lodging their tax returns.

The concession is administered through AusIndustry on behalf of the Industry Research and Development Board (IR&D) and the Australian Taxation Office.

The industrial automation software developer says that innovative, focused R&D isn't an optional extra, it's essential to survival and growth.

Citect has been taking advantage of the concession since 1986/87, and in 1998, began developing its ObjectCitect project - a new generation of industrial software.

Citect CEO and managing director, Wayne Morris said: "We needed to research emerging technologies being developed by Microsoft and other companies and develop our own set of base components if we were to extend our product range and meet market demands.

"However, this meant substantially increased development costs, particularly in terms of skilled staff, which would have been difficult without help."

The company then increased staff levels within its technology group and embarked on a significant R&D project.

Furthermore, by early 2001, Citect realised that its ObjectCitect project had much broader applications than originally planned and could be used as the basis of a number of other product initiatives.

By continuing to utilise the R&D Tax Concession, the company has gone on to build database, server and software configuration tools and visual presentation technologies and components that will be the basis for HMI/SCADA and industrial automation management.

To qualify for the R&D Tax Concession, a company's R&D activities must meet a range of criteria.

• Systematic, investigative and experimental activities which: involve innovation; involve high levels of technical risk; are carried on for the purpose of acquiring new knowledge; or creating new or improved materials, products, devices, processes or services.
• Other activities which are directly related to the undertaking of the above activities.
• The subject of an approved R&D plan.

Companies can claim the concession by completing the ATO R&D Tax Concession Schedule and the relevant labels in their tax return. But before claiming the concession, businesses must be registered by the IR&D Board for that year of income.

A company's annual expenditure on research and development must also be more than $20,000 to qualify - unless the work is contracted to a Registered Research Agency - and all R&D must be undertaken on a company's behalf.

Citect general manager technology, Martin Roberts credits AusIndustry assistance as a significant factor in the development of CitectSCADA, CitectSCADA Facilities, Plant2Business Downtime Solutions and Plant2Business Historian.

A large mining concern in Queensland is already taking advantage of technologies developed from the original project to improve its plant down time management.

The AusIndustry website provides the information required to apply for the concession.