Every year, thousands of Australian businesses wait for their R&D Tax Incentive (R&DTI) rebate to be processed by the ATO. While the rebate is a welcome boost, the reality is that many companies wait months after lodgement to see it, which leaves a cashflow gap right when you’re ready to hire, test, or scale.
If this sounds familiar, you’re not alone. Many businesses assume there’s no way around the delay, but that’s not the case. With R&D finance, you can access your R&D rebate early, align funding with milestones, and even plan for future claim cycles. This is particularly relevant for R&D-heavy businesses, since timing often makes the difference between accelerating core R&D activities or slowing them down while waiting to claim the R&D tax.
This blog explains exactly how to access your R&D Tax Incentive early, why it matters, and how staged draws can smooth cash flow throughout the year.
The hidden cost of waiting for your rebate
For most businesses, the timing mismatch between when R&D costs are incurred and when the rebate is paid is the real issue. You pay for hires, prototypes, trials, or lab time now, yet the rebate often arrives months after the income year has ended.
That lag creates bottlenecks:
- Hiring decisions get pushed back until funding clears
- Supplier orders are delayed, sometimes costing you better pricing
- Trial phases are paused, stretching timelines
- Leadership spends time managing cash flow gaps rather than building
The research and development tax system was designed to support innovation, but the calendar rarely matches the moments when capital is most needed. That’s where R&D finance comes in. For any business undertaking core R&D activities, the issue isn’t eligibility but timing, and finance helps bridge the gap until you can formally claim the R&D tax.
The simple way to unlock your R&D rebate sooner
R&D finance is a facility that advances funds against the rebate you are already entitled to. If you’ve incurred eligible R&D expenditure in the current income year, you don’t have to wait until the ATO processes your company tax return to access cash. Instead, you can:
- Apply for R&D finance based on your eligible year-to-date R&D spend
- Once approved, draw down funds when they line up with project milestones
- When the rebate is paid, repay the R&D loan directly from those proceeds
It’s straightforward and designed to complement the rebate rather than replace it. You continue working with your tax advisor, R&D advisor, or internal finance team to prepare and lodge your claim. Nothing changes in terms of compliance with the R&D tax incentive program—you still follow the same process, and your claim is assessed as usual. The only change is that funding arrives sooner, giving eligible R&D entities more control over their roadmap.
Why early access to your R&D rebate changes everything
Accessing your R&D Tax Incentive early is not just about filling a temporary gap; it changes how you plan and deliver. Here’s how businesses benefit:
Keep hiring on schedule
Talent is rarely available on your timeline. When the right person is ready to join, you need the confidence to commit, rather than waiting for funding. Early access to your rebate lets you bring key hires on board when they’re needed most.
Commit to suppliers and long-lead items
From specialised equipment to clinical trial batches, many R&D programs require long-lead purchases. With cash available, you can secure favourable terms and avoid delays.
Smooth cash flow between claim periods
Rather than lumpy funding once a year, R&D finance creates a smoother flow. This reduces the “stop-start” nature of projects and helps teams maintain momentum.
Protect ownership
Unlike equity funding, R&D finance is non-dilutive. You retain full ownership while still unlocking the capital you need to grow.
When core R&D activities are funded at the right time, projects progress faster, milestones are hit sooner, and businesses make the most of the support available under the R&D tax incentive program.
Turn one rebate into regular instalments
One of the lesser-known advantages of R&D finance is that you don’t have to access your rebate in one lump sum. You can structure draws in instalments, aligning them with the rhythm of your roadmap.
For example:
- Draw in Q1 to cover a hiring round
- Draw in Q2 to fund a prototype build
- Draw in Q3 to support a clinical trial phase
- Pause in Q4 if spend slows, then resume when it ramps back up
This approach lets you smooth your working capital across the income year and avoids holding unnecessary debt on the books. It also gives boards and investors confidence that funding is being deployed with discipline, tied to clear milestones.
How to prepare now for next year’s rebate
Even if you’re already waiting on this year’s rebate, you can set yourself up for the next income year. By arranging R&D finance in advance, you know your cost of capital early and can build it into your budget.
This forward planning helps you:
- Test different funding scenarios without changing assumptions mid-year
- Reduce pressure on end-of-year negotiations
- Show boards and investors that funding risks are managed
- Move faster on opportunities, knowing capital won’t be the blocker
Great R&D is a marathon made of sprints, and financing should match that rhythm. Having certainty across cycles reduces risk and makes delivery more predictable.
Take the next step to access your rebate early
If you’re tired of waiting each year for your R&D Tax Incentive rebate, R&D finance offers a way to bring that funding forward. Whether you prefer a lump sum or staged draws across the income year, the facility adapts to your roadmap so cash flow supports delivery rather than holding it back.
At Rocking Horse, we specialise in helping innovative businesses unlock their rebate early while keeping ownership intact. If predictable funding would make planning easier, apply today to set up your facility, or book a quick call with our team to explore how early access could accelerate your next phase.
Frequently asked questions
Do I have to draw all at once?
No, you can stage draws across the year as eligible spend accrues, and that’s how many teams prefer to use the facility. Think of the approved limit as headroom that’s tied to your incurred, eligible R&D spend in the current income year. You choose when to convert part of that headroom into cash, so you can line up funding with milestones like a hiring round, a prototype build, or a trial phase.
And because interest applies only to the funds you’ve actually drawn and kept outstanding, staged draws give you control over both timing and cost. If activity pauses, you can wait; if it accelerates, you can request another draw (subject to your facility and limits). The goal is simple: match funding to the work rather than to a single date on the calendar.
Does this replace the R&DTI?
No, the R&DTI remains a government program, and your claim still runs through the usual steps. You register your activities as normal and include the claim in your company tax return; when the ATO processes it, the R&D tax offsets flow through the income tax system. R&D finance sits alongside that process. It brings forward part of the expected rebate based on the eligible spend you’ve already incurred, and then the facility is repaid from the rebate when it’s paid.
What if my plans change?
Roadmaps shift, milestones slip, suppliers move dates, or costs land earlier than expected. R&D finance is designed to flex with that reality. If timing moves out, you can defer a draw until eligible spend catches up. If a milestone pulls forward, you can bring a draw forward (subject to approval and limits). You can also reduce the size of a planned draw or pause between tranches so you only borrow what you need, when you need it.
If you’ve already drawn and later decide you need less headroom, you can structure repayments in line with your terms, including repaying early if that makes sense for your cash flow. Throughout, the principle is the same: funding follows the work, not the other way around.
What costs are eligible?
The borrowing base references the same categories you intend to claim under the research and development tax incentive for the current income year. In practice, that often includes direct salary costs for staff working on eligible R&D activities, contractor and consultant costs tied to experiments, consumables, prototypes built to test or validate, and trial-related expenses that meet program rules. It’s important to note that you will need to get your eligibility certified by an R&D advisor before you can apply for R&D finance. Your R&D advisor will be able ot help you understand what spending is eligible.