Tax relief for research and development

As of 1 January 2016, the entrepreneurs investing in innovations may take advantage of the CIT relief. Each enterprise may deduct from 10 to 30% of the eligible costs of research and development activities (R&D) disclosed in the register. As results of the works are irrelevant, the relief may be also obtained for the projects that were not successful. The key to take advantage of the support is to correctly define the actions, projects and costs that constitute the basis for the relief.

For whom the R&D tax relief is available

Innovations may appear in many sectors of the economy. Thus, aby company may take advantage of R&D reliefs, irrespective of size and industry. It is estimated that about 80% Polish companies may take advantage of the R&D relief benefits. The exception are the entities that already enjoy privileges of special economic zones and taxpayers whose costs of R&D activities have been financed in any way. 

How much can one save

The deduction is applicable on the properly assigned eligible costs in the amount of: 

  • 30% of costs of salaries and contributions of the employees executing research and development activities,

  • 10% for large companies and 20% for SME – expenditures for acquisition of materials, raw materials, advisory and similar services, results of scientific research, using specialised instruments or depreciation of own items of assets used in R&D activities.

How to obtain the R&D tax relief

To obtain the relief: 

  • Determine whether the enterprise is conducting research and development activities in accordance with the requirements of the act of 25 September 2015 on amending some acts in reference to support for innovativeness.
  • Indicate which projects and in what scope constitute R&D activities.
  • Assign qualified costs of the indicated activities to the tax relief.

 

What does research and development activity mean?

Research and development activities are scientific research or development works that are systematically undertaken by the enterprise in order to increase, as well as use the already existing resources of knowledge to create new applications.

Qualified deductible costs: 

  • Salaries and social insurance contributions of the employees in the part financed by the employer (related to the execution of the activities considered to be R&D).
  • Acquisition of materials and raw materials directly related to the conducted R&D activities.
  • Expert opinions, opinions, advising services and equivalent services, as well as acquisition of results of scientific research, provided or executed on the basis of a contract by a research unit, for the needs of the conducted R&D activities.
  • Fee-based using of scientific and research instruments used in R&D activities.
  • Depreciation write-offs on fixed assets and intangibles used in R&D activities.

Depreciation costs of passenger cars, buildings, structures and housing units are not subject to deduction. 

Duties of the taxpayers who intend to take advantage of the relief: 

  • Isolation of the costs of R&D activities in the conducted tax accounting.
  • Incurring non-refundable qualified costs (e.g. costs of salaries of engineers developing a new or significantly improved programme).
  • Conclusion of a contract with a research unit (in case of purchase of basic research). 

Guarantees of Ayming Polska: 

  • The correct definition of R&D actions: Ayming Polska experts conduct a comprehensive analysis in the scope of research and development activities, thus they can specify whether and in what scope the company may take advantage of the R&D tax relief.

  • The proper qualification of costs: with the unique know-how, Ayming Polska experts correctly define which costs of innovative activities should be included in the catalogue of eligible R&D costs, which enables full use of the possibilities of the R&D tax relief.

  • Legal protection: Ayming Polska consultants prepare and collect technical and scientific documents and obtain interpretations of tax regulations, which secures the possibility of taking advantage of the relief.
      
  • Support in each stage of the process: Ayming Polska ensures full technical, scientific support, as well as accounting control and the possibility of representation of the company before tax organs.

  • Access to the unique know-how: with the international experience in the execution of research and development projects, Ayming Polska has at its disposal unique knowledge on R&D solutions.