R&D tax credit – European grants
Revenue’s R&D Tax and Duty Manual has been updated to include footnote 11 in section 2.6 which covers how to treat grants received. Generally, section 766 (1)(b)(v) TCA 1997 says that any expenditure met by grant aid will not be regarded as qualifying expenditure for the purposes of the R&D credit. Footnote 11 however states that grants received from the European Commission “may not fall within the definition of section 766(1)(b)(v) TCA 1997, this will be dependent on the terms and conditions as set out in each grant agreement.”