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Research & Development - Tax credit regime

18 June 2019

The most valuable features in business today are people and ideas - in particular, people with ideas.

The Irish research and development (R&D) tax regime provides a 25% credit for qualifying expenditure on qualifying activities. This means that companies can now obtain an effective tax deduction of up to 37.5% with the possibility of the value of the R&D tax credit being refunded where there is not a sufficient level of taxable profits within the company/group.

Consider how much money your business spends when trying to develop or improve its products or processes. Now imagine you could reduce that by 25%.

Features of the Irish R&D tax regime

Companies are entitled to a credit of 25% of the incremental R&D expenditure incurred for periods commencing on or after 1 January 2015.

The credit can be used to:

  • Reduce the company’s corporation tax liability of the period
  • Reduce the corporation tax liability of the previous year, or
  • If unused, the credit can be refunded by the tax authorities subject to certain restrictions.

Download our R&D brochure to find out more.