Research & Development Tax Credits Overview
Did you know the R&D tax credit regime in Ireland can be a significant source of tax savings for your business?
The Irish research and development (R&D) tax credit 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%.
Yet, many companies are not actually aware that they are carrying out activities that may qualify for the lucrative relief of R&D tax credits. R&D activities are not limited to those that occur in a traditional research lab. In fact most claims are for experimental development which often takes place right on the factory or shop floor.
Early payment of 2021 instalments of R&D Tax Credits
Typically any repayable R&D tax credit refunds are not paid out earlier than the relevant CT filing deadline (i.e. 9 months after the relevant accounting period ends).
In the exceptional circumstances of the Covid-19 pandemic and subject to appropriate checks in selected cases, Revenue will expedite the payment of any instalment of excess R&D tax credit that is due to be paid in 2021, bringing forward payment in advance of the 9 months window.
Requests for Revenue to expedite the payment of any 2021 instalments of excess R&D tax credits should be made through MyEnquiries. To enable early repayment, the CT1 for the company’s accounting period ending in 2020 and for accounting periods ending up to March 2021 must, at the time of the request, be submitted.
To ensure timely processing of requests, they should be tagged appropriately within MyEnquiries:
• enquiry relates to ‘Corporation Tax’
• more specifically ‘R&D instalments payable in 2020 and 2021’.
Do you have an R&D related query?
If you would like to request more information on R&D tax credits or information on how we can assist your company, please complete the below contact form and tell us about your company's research and development activities.
Do you want to explore other R&D related incentives?
Research, Development & Innovation Grant
Knowledge Development Box