Where R&D tax credits reduce income taxes payable, you must update both the “Total amount paid (refunded)” of the “Income tax receivable (payable)” and the “R&D receivable (payable)”.
For example,
If the income taxes payable totalled $10,000 and the R&D credits totalled $8,000 and the $2,000 payment was paid to the applicable agency, the following must occur under the “Reconciliation of prior year balances”:
1) Under the “Reconciliation – income tax receivable (payable)”, include the total amount paid as $10,000 ($2,000 paid to agency + $8,000 R&D refund applied)
2) Under the “Reconciliation – R&D receivable (payable)”, include the total amount refunded as ($8,000) ($8,000 R&D refund applied).