R&D – super-deduction
Have you heard about the super-deduction of R&D expenditures? This is an attractive tool for financing innovations which has been available to Slovak companies since 2015. This support for science and research is based on tax relief using expenditures on research and development activities.
Although it is mainly supporting science and research, it does not necessarily mean that you have to hide a laboratory in your company. Super-deduction can be applied in various industries - from IT to food or textile production. It does not matter whether you are an international corporation or small local business, you can apply for it.
HOW DOES THE SUPER-DEDUCTION WORK?
As already mentioned, the super-deduction for R&D is based on tax relieves and can be claimed by taxpayers who carry out research and development in addition to their normal business activities. It doesn't matter if you are a legal entity or a natural person with income from business and other self-employed activity. The relief consists in the additional deduction of research and development expenditure from the tax base. Costs related to research and / or development can be deducted from the tax base, up to a maximum of 200%. Additionally it is possible to make use of the so-called year-on-year deduction of research and development expenditures up to 100% of the average year-on-year increase of all tax deductible research and development expenditures (costs).
• Eligible expenditure on research and development of the company: € 100,000
• 200% super-deduction (represents a reduction of the tax base): € 200,000
• Income tax savings: € 42,000
• + Additional savings from year-on-year deduction
WHAT EXPENSES CAN BE APPLIED?
One of the advantages of super-deduction R&D is that entrepreneurs do not have to wait for its approval, as it is with various forms of support for public funding. You can easily claim it yourself through a tax return. Of course, only after meeting various criteria.
As part of the super-deduction you can claim, for example, expenses on:
• labour costs,
• material consumption,
• and others.
Keep in mind that you may be asked to submit a research and development project during a tax audit!
HOW CAN WE HELP YOU?
In connection with R&D super-deduction, we offer you a complete package of services that begins with a consultation. You can rely on our tax advice and help with verifying the correctness of the calculations of the super-deduction of R&D costs, or we would prepare a calculation of the super-deduction of R&D costs for you.
We will prepare a complete R&D project for you in cooperation with SmartTech Solutions SK, s.r.o., which is a renowned specialist in the super-deduction of R&D expenses, especially from the technical point of view. At the same time, we will represent you as our client in case of the opening of a tax audit focused on R&D super-deduction. Most importantly, you will save a lot of time because you can leave your agenda completely to our experts with several years of experience.
Every year, the super-deduction relief is used by hundreds of entrepreneurs who can save thousands of euros thanks to it. If you would also like to use this opportunity or you are not sure whether the super-deduction is also intended for you, contact our consultants and find out about your options.