Tax credit

Research and Development 2021 – 2022

Tax measure that aims to reward the efforts made by companies in the development of research and development activities and which allows offsetting the tax rate up to 100%, thus increasing competitiveness and encouraging continuous improvement of products and processes.

Scope

Research and Development

  • Basic research
  • Applied research
  • Experimental development

Who can

benefit from it?

All businesses resident in the territory of the state can benefit from it, including permanent establishments of non-resident entities, regardless of the legal form, economic sector to which they belong, the size, and tax regime for determining the company’s income.

Use of

credit

The credit can be used as compensation in 3 equal annual installments.

Our

service

Our activity, as expert consultants in the management of the Research and Development Tax Credit, consists in identifying the activities and related eligible expenses, thus improving the ability to take advantage of tax benefits.

Bonus CIRS

in the South

Art. 185 of Law No. 178 of 30 December 2020 extends to the two-year period 2021-2022, the possibility for companies in Southern Italy to recover up to 45% of the expenses incurred for Research and Development activities according to the definition of Frascati.

Eligible expenses

The tax credit is granted to the extent of 20% of eligible expenses for research and development, up to a maximum of 4M€, in three annual installments.

  • Researchers and technicians with subordinate or self-employment relationships or other relationships other than subordinate jobs.
  • Personnel costs relating to individuals aged <= 35, on first employment, in possession of a PhD or enrolled in a PhD program or in possession of a master’s degree in technical or scientific disciplines, hired by company with an open-ended employment contract and employed exclusively in research and development work, contribute to form the basis for calculating the tax credit for an amount equal to 150% of their amount.
  • Depreciation, finance lease or simple lease fees and other expenses relating to movable tangible assets and software up to an overall maximum limit equal to 30% of personnel expenses in letter a).
  • Extra-muros research contracts.
  • The subjects to whom the projects are commissioned must be fiscally resident or located in other EU member states or in states adhering to the EEA agreement or in states included in the list referred to in the decree of the Minister of Finance of 4 September 1996.
  • Depreciation related to the purchase from third parties, even under license to use, of industrial property rights relating to an industrial or biotechnological invention, a semiconductor product topography or a new plant variety, up to a maximum limit of € 1 million.
  • Consultancy services and equivalent services within the overall maximum limit equal to 20% of the eligible personnel costs indicated in letter a) or letter c), without taking into account the increase envisaged.
  • Materials, supplies and other similar products also for the construction of prototypes or pilot plants, up to a maximum of 30% of personnel expenses in letter a) or, extra muros research in letter c).

BUDGET LAW 2020 AND CHANGES IN THE RESEARCH AND DEVELOPMENT TAX CREDIT

The 2020 Budget Law approved on 27 December 2019 introduced changes regarding the regulation of the incentives and concessions of the Industry 4.0 plan, which with the 2020 Budget has been redefined as the National Business Plan 4.0.

Variations have been introduced with regard to the Research and Development Tax Credit and Hyper-amortization, while the Training Tax Credit has been extended.

New features introduced:

  • Replacement of hyper-depreciation with tax credit for investments in tangible and intangible assets;
  • Extension of the tax credit also to Innovation and Design;
  • Elimination of the minimum threshold and the incremental character;
  • Change in the percentages of the tax credit and maximum limits;
  • Compensation in 5 or 3 equal annual installments;
  • Necessary communication to the MISE for use of the tax credit:
  • Introduced references to the Frascati and the Oslo Manual.
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