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Increased benefit in the R&D tax relief from 2018
Increased benefit in the R&D tax relief
The Ministry of Science and Higher Education has published a draft of amendments to the R&D tax relief.
R&D tax relief - increased benefits
The draft envisages a significant increase in the premium in the form of an additional deduction of eligible costs from the tax base amounting to:
- 100 percent for all categories of eligible costs for all enterprises (for 2017 this is 50 percent for SMEs and
30-50 percent for large enterprises); - 150 percent for all categories of eligible costs for taxpayers having the status of a research and development center (CBR).
Examples of the R&D super deduction calculated on the basis of the relief amount proposed from 2018
| Year |
Annual R&D costs | Effective reduction of income tax payable *(CBR) |
|---|---|---|
| 2017 | 10 000 000 PLN | 950 000 PLN (950 000 PLN)* |
| 2018 | 10 000 000 PLN | 1 900 000 PLN (2 850 000 PLN)* |
| 2019 | 10 000 000 PLN | 1 900 000 PLN (2 850 000 PLN)* |
| Total | 30 000 000 PLN | 4 750 000 PLN (6 650 000 PLN)* |
Extension and clarification of the catalogue of eligible costs
The draft extends and clarifies the catalogue of eligible costs, including:
- employee salaries will be eligible for the relief in the part relating to R&D activity (elimination of the “employment for the purpose…” provision which has been a source of interpretative differences);
- remuneration of natural persons engaged in R&D activities under a contract of mandate or a task-specific contract will be eligible;
- the purchase of specialised R&D equipment, which is not a fixed asset, will be eligible
Additional benefits for CBR
Taxpayers having the status of CBR will receive additional benefits in the form of:
- increased premium – 150 percent of eligible costs;
- expanded catalogue of eligible costs:
- depreciation of structures, buildings and premises constituting a separate property, used in R&D activities;
- studies, opinions, consulting and equivalent services, researches, technical knowledge and patents or licenses for protected inventions purchased from entities other than scientific units.
- the possibility of obtaining a CBR status for entities that earned revenues of PLN 2.5 million or more.
Other, selected changes provided by the draft
- enabling R&D tax relief for taxpayers operating in a SEZ, for “non-zone” activities;
- extending the tax exemption of companies whose sole business is financial investment activities, for income from the sale of shares in entities conducting R&D, purchased between 2016 and 2023;
- facilitating the development of scientific careers, combined with the development and implementation of commercial solutions in enterprises – this change is intended to encourage research and companies to increase cooperation.
How can we help?
The Grants & Incentives team at KPMG is part of the international KPMG R&D Incentives Network. Our experts have many years of experience in identifying and claiming grants and incentives for R&D worldwide.
We offer a fully comprehensive approach enabling companies to benefit from the new tax relief for R&D:
- assistance in obtaining the status of an R&D center;
- mapping the operations and costs eligible for deduction;
- assistance in the process of accounting separation of eligible costs;
- calculation of the R&D tax relief amount;
- preparation of the annual R&D report and filing of the R&D declaration;
- assistance in adjusting the company’s organizational – legal and accounting processes for the effective use of incentives.
Our many years of experience in claiming support for R&D project and cooperation with scientific and technical experts offers our customers an efficient service for claiming tax relief for R&D.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
