Latest News

  R&D Tax Credit Update 

 

1. Recent statistics published by Revenue for 2017 show further fall in the total exchequer cost of the R&D Tax Credit 

The Revenue Commissioners recently published statistics showing that while the number of companies that claimed the R&D Tax Credit in 2017 (1,505) was consistent with 2016 (1,506), there was a significant drop in the total exchequer cost of the R&D Tax Credit between 2016 (€670m) and 2017 (€448m). 2016 had itself marked a sharp decline from 2015 when the total exchequer cost peaked at €708m.

Table 1 below shows the number of companies that claimed the R&D Tax Credit and the total exchequer costs for 2005 to 2017 inclusive. As shown in Table 2, large companies (250+ employees) appear to have been hit hardest by these declining numbers.

Table 1. R&D Tax Credit - Total Excehquer Cost and Number of Companies claiming

Table 1, R&D Tax Credit - Total Exchequer Cost and Number of companies claiming

 Table 2. Breakdown of R&D Tax Credit by size (based on employee numbers) of claimant

Table 2, Breakdown of R&D Tax Credit by size (based on employee numbers) of claimant 

 

2. Revenue issue "clarification" regarding the treatment of European Commission grants in R&D Tax Credit claims

S766(1)(b)(v) TCA, the section of legislation covering grants, states the following:

 

“expenditure shall not be regarded as having been incurred by a company if it has been or is to be met directly or indirectly by grant assistance or any other assistance which is granted

by or through—

(I) the State or another relevant Member State, or

(II) any board established by statute, any public or local authority or any other agency of the State or another relevant Member State;

 

Earlier today, Revenue issued eBrief No. 129/19 confirming that the section of the Tax and Duty Manual dealing with the treatment of grants for R&D Tax Credit purposes has been updated to include the following footnote:

 

“European Commission grants may not fall within the definition of section 766(1)(b)(v) TCA 1997, this will be dependent on the terms and conditions as set out in each grant agreement.”

 

Therefore, if you are in receipt of grants from the European Commission or are considering applying for such grants, it is important that you consider the potential impact of this updated guidance on your R&D Tax Credit(s).

Revenue eBrief No. 129/19 can be accessed here https://www.revenue.ie/en/tax-professionals/ebrief/2019/no-1292019.aspx

 

2.      

About Us

SciMet R&D is the leading, Irish owned, independent R&D Tax Credit consultancy. The company was founded on a simple principle – to consistently deliver exceptional service and value to R&D performing companies in claiming their full and proper R&D Tax Credit entitlement.

We achieve this by delivering the perfect blend of science, technology, tax and accounting expertise. The R&D Tax Credit is unique in that it combines a science test with an accounting test. SciMet R&D is unique in the Irish market in the value we bring to our clients in meeting both tests.

At SciMet R&D we are truly passionate about science and technology. It motivates us to be able to play a part in the exciting research and development being carried out by our clients.  Our tailor-made R&D Tax Credit services deliver efficiencies, robustness and cost effectiveness that facilitate our clients in doing what they do best – innovate.

Our Address: Unit 3, Cova, Trafalgar Road, Greystones, Co. Wicklow