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Czech Republic: Transitional rules on R&D allowance

Czech Republic: Transitional rules on R&D allowance

Information published by the tax authority concerning a 2019 tax package (effective 1 April 2019) includes transitional rules for the research and development (R&D) allowance.

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In general, the new rules apply with respect to R&D projects that are started on or after 1 April 2019. However, application of the new rules is optional for projects initiated during the period from 1 January 2019 to 31 March 2019. Projects initiated before 2019 are subject to the original rules (that is, the rules in effect before the legislative amendment).

The tax authority’s position, however, concerning the transitional provisions generally allows a taxpayer to select which rules to apply for R&D projects that are started before 1 April 2019.

The new rules also include a duty to notify the tax authority of an intention to claim the R&D allowance for a project (before starting the project). The rules requiring preparation and approval of the R&D project documentation before the project is started also allow for a delay until the deadline for filing the tax return for the period when the taxpayer first claims the R&D allowance for the project.


Read a July 2019 report prepared by the KPMG member firm in the Czech Republic

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