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Embedded systems / IoT - R&D Tax Benchmark

What proportion of total business expenses do Australian embedded systems / iot typically claim as R&D under the RDTI?

Typical range
20–55%
Direct (core) R&D as % of expenses
Elevated but plausible
up to 75%
Still defensible with strong evidence
Unusual - review carefully
> 88%
May still be valid; expect AusIndustry scrutiny
Supporting R&D
5–15%
Indirect / supporting activities

What drives R&D intensity in this sector

Firmware, power-management and connectivity stack R&D dominate pre-launch.

Sector disclaimer

Embedded product companies sit similarly to hardware; integration with existing modules without uncertainty is not core R&D.

ATO & AusIndustry context

Use of off-the-shelf SDKs without modification rarely qualifies.

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Educational benchmark only - not an eligibility test or tax advice. Final eligibility depends on whether your activities meet the s.355-25 / s.355-30 core and supporting R&D definitions and is determined by AusIndustry on registration.