R&D expense-based tax reduction (CIR)


Characteristics of the aid


The R&D expense-based tax reduction is a tax disposition created by the government to support R&D efforts by companies. They benefit from a tax reduction calculated upon their R&D expenses.

Since 1 January 2008, the tax reduction is calculated upon the R&D expense amount declared by companies.

The CIR rate is granted to companies and calculated as follows:

  • 30% of R&D expenses for a first amount up to 100 M€.
  • 5% of R&D expenses beyond this 100 M€ ceiling.

The tax credit is deducted from the income or business tax due by the company the year when the R&D expense was spent.

Beneficiaries


All industrial, commercial, or agricultural companies subject to taxes (whatever their size or their activity field).

Eligible expenses


Mainly concerned are expenses related to human and material means affected to R&D within the company, to sub-contracted R&D, to technological intelligence, to intellectual property and patent applications. More specifically, expenses concerning 3 reference categories:

  • Fundamental research activities
  • Applied research activities
  • Experimental development activities (including prototyping and pilot design and making)

Source: Ministry of Research & High education – May 2009.