The Institute, under the auspices of the CCAB-I, responded to the Department of Finance’s public consultation on the R&D Tax Credit and the Knowledge Development Box (KDB), noting the complexity experienced by SMEs in particular in claiming both reliefs. Key areas identified where change would greatly improve the attractiveness and accessibility of the R&D tax credit include:
- Simplifying the rules for SMEs engaging in R&D activities. Presently, many SMEs are discouraged from claiming the R&D tax credit due to complex and onerous compliance requirements.
- From an international perspective, making the R&D tax credit fully refundable in the year it arises in response to concerns regarding the impact of recent changes to U.S. tax regulations, which go beyond the OECD GloBE rules.
- The adoption of a 50 percent R&D tax credit for research and development in the area of solar, wind, biomass, or hydro energy, and other green technologies, supporting Irish companies’ contribution to the global effort to develop solutions to climate and energy crises.
In terms of the KDB, the CCAB-I recommends that to become a meaningful policy offering, the rules need to be simplified and provision also needs to be made for providing a benefit to loss-making companies who may be carrying on qualifying activities.
Our response was informed by a survey of members, and we would like to thank them for their input. Coverage of the response was included in the Sunday Independent Business.
You can read the full submission here.