We had a very good discussion during last Friday’s conference call on the IRDG Survey on R&D Grants and Tax Credits which was circulated on Monday 30th Jan to all members. Thank you to all who took the time to phone in and participate in the discussion.
The key issues that were raised during the call were as follows:
- It was suggested that IRDG should raise the issue of the 2003 base year for R&D Tax Credits with Revenue as it would appear to be discriminatory against some companies.
- The question was raised during the call as to how many years back Revenue can audit for R&D Tax Credits. This was clarified during the call as 4 years.
- It was pointed out that a company can only go back one year in claiming Tax Credits and the disparity between this and Revenue’s right to go back 4 years was raised.
- The requirement that the R&D Tax Credit appear below the line i.e. in the tax line, was seen as working against some companies who were part of a Group. Information Sheet 04/2009 from the Institute of Chartered Accountants of Ireland provides some guidance on this. This can be sent onto any member who is interested.
- A summary of the different grant types that are available was requested and this will be incorporated into the new IRDG website which will come on stream in early April. Members are also welcome to recommend other guides or documents that would be of benefit and could be included in the private members area.
The Finance Bill is expected tomorrow Wednesday 8th and the details of the changes to the R&D Tax Credits announced in Budget 2012 will be available. IRDG will circulate to all members once available. The main announcements in Budget 2012 were:
- The introduction of a volume-based regime for the first €100k of R&D spend. The new, albeit limited, volume-based regime will provide for a 25% R&D tax credit for every euro incurred, capped at €100k of expenditure.
- Improvements to the existing subcontracting rules. This improvement will enable a company to claim an R&D tax credit on the greater of the current percentage-based limits (i.e. 10% of the company’s spend on in-house R&D; 5% in the case of third level institutions) or €100k.
- New reward mechanism for key employees who have been involved in the development of R&D
As mentioned during the call, these survey results will be presented to the Revenue, Department of Finance, IDA and EI over the course of the next few weeks. The points raised by members above will be shared with the relevant bodies during those meetings.
Finally, members are welcome to contact the IRDG team for assistance on any matter relating to Research, Development and Innovation. Contact details are as follows:
Denis Hayes, Managing Director, email@example.com or 086-2544473
Mary Byrne, Membership Development / Communications Manager, firstname.lastname@example.org or 087-6501215
Kathleen or Lorraine in the Office, email@example.com or 01-2374671
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