Budget 2026 (delivered 28 May 2026) cuts the R&D Tax Incentive cap on non-administrative internal software from $25 million to $3 million per year, saving the Crown about $87 million over four years. It also introduces in-year (quarterly) RDTI payments so the 15% credit reaches companies sooner instead of at year-end. Most changes take effect from the 2027-28 income year.
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Budget 2026 slashes RDTI internal-software cap from $25m to $3m, adds in-year payments
Why this matters for founders
Software startups running large internal-software R&D should front-load or restructure claims before 2027-28, when only $3m of that spend stays creditable; all RDTI claimants can plan cashflow around receiving the credit quarterly rather than at year-end.
Source: BDO New Zealand
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