Claims for Research and Development (R&D) tax credit in respect of projects approved for Research Technology & Innovation (RTI) grants from Enterprise Ireland.

Section 766 TCA 1997 provides for a tax credit of 20% of incremental expenditure by a company, or group of companies on R&D.

To date it has been necessary for Revenue to employ experts to provide opinion as to whether an activity satisfies the scientific criteria required by statute.

In broad terms, the definition of R&D contained in S 766 TCA 1997 and in the Enterprise Ireland grant-aided scheme for RTI grants are generally comparable. Therefore, to simplify procedures for smaller claims, it has been decided that Revenue will not, as a rule, seek to independently/separately have a claim in respect of smaller projects examined by an expert where an Enterprise Ireland RTI grant has been approved in respect of the project.

This practice will only apply where:

1. The project has been the subject of an RTI grant, and
2. The R&D tax credit claimed for an accounting period (of not less than 12 months) is €50,000 or less, and
3. The project is undertaken in a prescribed field of science or technology, as defined in regulations (S.I. No. 434 of 2004).

Further details will be included in the next issue of Tax Briefing.