R&D tax relief – increased benefits

The act provides for a significant increase in the bonus 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 was set at 50 percent for SMEs and at 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 (R&D Center).
  

Examples of the benefits that the relief can bring in a five-year period:

Extension and clarification of the catalogue of eligible costs

The act 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 of…” provision which has been a source of interpretative uncertainties);
• remuneration of individuals engaged in R&D activities under service or specific task contracts was included in the catalogue of eligible costs;
• new categories of eligible costs have been added:
  • the purchase of specialized R&D equipment, which is not a fixed asset,
  • the purchase of services enabling the use of research equipment for R&D,
  • costs of R&D carried forward as an intangible asset.

Additional benefits for R&D Centers

Taxpayers having the status of an R&D Center will receive additional benefits in the form of:

• increased bonus – 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.
• possibility of obtaining a CBR status for entities earning revenues of PLN 2.5 million or more.

Other, selected amendments introduced by the act

• enabling R&D tax relief for taxpayers with permission to operate in a SEZ;
• extending the tax exemption of companies whose sole business consists of 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 scientists 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 applying for grants and claiming 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 projects and cooperation with scientific and technical experts offers our customers an efficient service for claiming tax relief for R&D.