Dear Sir or Madam, dear Clients, dear friends,
at the end of 2019, the German Bundestag passed the Research Grants Act (FZulG). The law came into force on January 1, 2020.
Who is it interesting for?
The law is of interest to all companies conducting research in Germany, regardless of their size, the purpose of the company and the respective profit situation (however, "companies in difficulty" as defined by the General Block Exemption Regulation {GBER} are excluded).
What is funded?
The following projects can be funded within the framework of the research and development projects:
· New developments, prototypes or pilot plants
· New and further developments of products
· Basic technological research
· Development of new technical processes
· Experimental development
How is funding provided?
The funding amounts to 25% of the personnel costs incurred in connection with a research and development project. Furthermore, the law supports contract research. In this case, 60% of the remuneration paid by the client to the contractor is eligible for funding. Eligible expenses are limited to EUR 4 million in a fiscal year, and to EUR 2 million from 2026.
Procedure
The procedure for applying for the research allowance consists of two-stage:
1. Application for R&D certification at the Research Allowance Certification Office.
The application is to be submitted on a web portal. The procedure starts with the registration of the company. The application should be submitted as an electronic form and must include the description of the R&D qualifying characteristics or criteria.
The certifying authority will review the application and ask for further questions or also have the right to request additional documents or descriptions. After the review, a decision is issued and notified to the applicant. The entitlement to the research allowance depends on the determination of whether a subsidized R&D project exists.
2. Application for research allowance at the tax office
In a second step, the research allowance is applied for at the responsible tax office. This application can only be filed after the end of the fiscal year in which the eligible expenses for subsidized R&D projects were incurred. In principle, the application for the research allowance can therefore only be submitted from January 1, 2021 in the vast majority of cases.
If you would like to apply for the research allowance at the tax office, please contact us - we will be happy to help you!