R&D Tax Credit

Revenue issue two briefs relating to R&D Tax Credits

The Revenue Commissioners play a key role in the administration and policing the R&D Tax Credit scheme, now worth over €500 million per annum to Irish industry.

IRDG, as the representative body for over 200 R&D-performing companies, engages on an ongoing basis with Revenue to feed back the views and experience of its members in relation to the R&D Tax Credit scheme.  We are pleased to see that Revenue have responded to a number of issues raised by IRDG members in making two important announcements in the form of ebriefs last Friday (see below).

Please note that the Head of Revenue for R&D Tax Credits, Aine Hollingsworth, will go into detail in relation to both of these provisions (and much more) at the IRDG R&D Tax Credit and Knowledge Development Box seminar – Thursday 9th March, Crowne Plaza Hotel, Blanchardstown, Dublin – book now.

This seminar is a great opportunity to hear first-hand from Revenue and there will also be an opportunity for you to ask questions and give your views.

eBrief Details

  1. R&D tax credit claims in respect of projects supported by Enterprise Ireland R&D grants

“While there are differences to the definition of R&D for the grants and the R&D tax credit, it is considered that the two definitions are relatively close. Therefore, with a view to minimising the burden of engaging experts to verify the science test in R&D tax credit claims, it has been decided that Revenue would not, as a rule, seek to challenge the science test in relation to a project where:

  • an Enterprise Ireland or IDA R&D grant has been approved in respect of the R&D project;
  • the project is undertaken in a prescribed field of science or technology, as defined in regulations (S.I. No. 434 of 2004);
  • the company is a micro or small enterprise within the meaning of the Annex to Commission Recommendation 2003/361/EC of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises; and
  • the total R&D tax credit claimed by the company for an accounting period (of not less than 12 months) is €50,000 or less.”

Note:

  • A small enterprise employs less than 50 people and has an annual turnover less than €10 million or an Annual balance sheet total of less than €10 million.
  • A micro enterprise employs less than 10 people and has an annual turnover less than €2 million or an Annual balance sheet total of less than €2 million.

http://www.revenue.ie/en/practitioner/ebrief/2017/no-172017.html

  1. Appointment of independent technical experts to assist with audit of R&D Tax Credits

Revenue have published a manual which sets out the procedure for appointing and briefing independent technical experts to assist in evaluating the science test in R&D tax credit audits.

http://www.irdg.ie/wp-content/uploads/2017/02/Revenue-Ebrief-Document-29-02-05-1.pdf

 

Mary

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