ABx Group Banks $600K R&D Tax Refund With $5M Grant Decision Due by Year-End
Key Takeaways
- ABx Group and ALCORE received combined R&D tax offsets of approximately $600,000 from the Australian Taxation Office for FY2025 activities — cash in hand, no equity dilution required.
- ABx's $386,471 offset relates to its terbium and dysprosium rare earths project in northern Tasmania, while ALCORE's $209,971 covers its proprietary hydrogen fluoride and fluorine chemicals process development.
- ALCORE has fully repaid $2.61 million in unused MMI grant funds to DISR, completing all obligations under the Federal Government's Modern Manufacturing Initiative with no residual liability.
- A further R&D offset based on capital expenditure for ALCORE's continuous pilot plant is expected in future years once the plant commences operations and depreciation begins.
- ALCORE's application for a Commercialisation and Growth Grant of up to $5 million under the Industry Growth Program has progressed to independent merit assessment, with an outcome anticipated before the end of 2026.
ABx and ALCORE receive $600,000 in R&D tax offsets
ABx Group (ASX: ABX) and its 83%-owned subsidiary ALCORE Limited have received combined R&D tax offsets of approximately $600,000 from the Australian Taxation Office for activities undertaken during the 2025 financial year. The receipts strengthen the Group’s balance sheet while a separate grant application of up to $5 million remains under assessment with an outcome expected before year-end.
The breakdown is as follows: ABx received $386,471.07, principally relating to its wholly-owned rare earths project in northern Tasmania, while ALCORE received $209,971.34 for the development of its proprietary process to produce hydrogen fluoride and fluorine chemicals from an aluminium smelter by-product. ALCORE’s offset was supported by an Overseas R&D Finding approval by AusIndustry in 2025.
ABx’s qualifying R&D activities centre on its rare earths discovery in northern Tasmania, a project targeting terbium and dysprosium mineralisation that sits among the more strategically significant heavy rare earth finds on the ASX in recent years.
It is worth noting that ALCORE’s current offset is based on operating expenditure only. A further R&D offset based on capital expenditure for the continuous pilot plant is expected to be received in future years, once the pilot plant commences operations and depreciation begins.
| Entity | R&D Offset Received | Qualifying Activities | Future Offset Expected |
|---|---|---|---|
| ABx Group | $386,471.07 | Rare earths project, northern Tasmania | Not specified |
| ALCORE Limited | $209,971.34 | Hydrogen fluoride and fluorine chemicals process (Overseas R&D Finding approved by AusIndustry 2025) | Capital expenditure offset pending pilot plant commencement and depreciation |
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MMI grant repayment complete — a clean slate on government obligations
ALCORE has fully repaid $2.61 million in unused grant funds to the Department of Industry, Science and Resources (DISR), completing all repayment obligations under the Federal Government’s Modern Manufacturing Initiative (MMI) grant programme. The sequence of events is straightforward:
- DISR approved $7.44 million in actual and committed ALCORE project expenditure, representing $3.15 million in eligible MMI grant funds.
- In June 2026, actual project expenditure was finalised at $7.26 million, which was $175,000 less than the forecast figure, updating the repayable amount to $2.61 million.
- ALCORE had received two grant instalments totalling $5.69 million, leaving $2.53 million repayable to DISR.
- Repayment was completed via approximately equal monthly instalments, concluding on 29 June 2026.
The MMI funding supported laboratory testing, batch pilot plant activities, and development of the continuous pilot plant at Bell Bay, Tasmania. This closure is routine and administrative in nature — ALCORE has met its obligations cleanly and moves forward without any residual liability under the MMI grant program.
What is the R&D Tax Incentive — and why does it matter for junior resource companies?
The Australian Government’s R&D Tax Incentive allows eligible companies to claim a tax offset on qualifying R&D expenditure. For companies operating at a loss (as most development-stage miners and technology companies are), this translates into a direct cash refund from the Australian Taxation Office.
For pre-revenue companies like ABx, that distinction matters. The incentive converts R&D spending into real cash receipts without requiring the company to raise equity from shareholders or take on debt. The $600,000 received is cash in the Group’s accounts, extending its operational runway to advance both the Tasmanian rare earths project and ALCORE’s fluorine chemicals commercialisation programme.
Industry Growth Program grant — up to $5 million catalyst still pending
ALCORE’s application for a Commercialisation and Growth Grant of up to $5 million under the Federal Government’s Industry Growth Program (IGP) remains under assessment. ALCORE submitted its application in late 2025, and in August 2026, DISR advised that eligible applications have progressed to the independent assessment committee for merit assessment, with grant outcomes anticipated to be available before the end of 2026.
The IGP supports small and medium enterprises undertaking innovative commercialisation and growth projects within priority areas of the Australian Government’s National Reconstruction Fund. For ALCORE, a favourable outcome would represent a meaningful non-dilutive capital injection to support the next stage of its clean fluorine chemical technology. ABx has committed to updating investors when an outcome is known.
Mark Cooksey, Managing Director and CEO, ABx Group
“…We look forward to the outcome of ALCORE’s Industry Growth Program application as we continue advancing the commercialisation of this important Australian technology.”
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What this means for ABx investors
Three takeaways stand out from this announcement:
- Cash position reinforced by $600,000 in non-dilutive R&D tax receipts received from the ATO.
- MMI repayment obligations fully extinguished, with no residual liability remaining under the program.
- A potential $5 million IGP grant outcome is anticipated before the end of 2026, representing a near-term catalyst.
Across its portfolio — rare earths in northern Tasmania, ALCORE’s continuous pilot plant under construction at Bell Bay, and near-term bauxite activities — R&D support across multiple project fronts reflects the Group’s active development pipeline and its ongoing engagement with government funding mechanisms.
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