R&D Corporation Tax Credit
Expenditure incurred by a company on Research and Development (R&D) activities may qualify for either the:
- R&D Tax Credit
- R&D Corporation Tax Credit.
Both are calculated at 25% of qualifying expenditure.
Subject to meeting certain conditions, a company may elect to claim the R&D tax credit or the R&D Corporation Tax Credit during a transitional period. In general, the transitional period applies in respect of accounting periods ending between 31 December 2022 and 30 December 2023.
A company may elect to accelerate repayable credits due in respect of an R&D tax credit claim made in accounting periods commencing before 1 January 2022. A claim to accelerate the payments may be made in a specified return for an accounting period commencing on, or after, 1 January 2022.
A claim for the R&D Corporation Tax credit is required to be made in respect of accounting periods commencing on, or after, 1 January 2023. The R&D Corporation Tax credit will be repaid in three annual instalments.
The R&D Corporation Tax credit is not offset against the company’s Corporation Tax (CT) liabilities. The company must elect to have the instalment treated as an overpayment, for offset against tax liabilities, or repaid.
For further information on the above, please see detailed guidance in The Research and Development Corporation Tax credit manual.
A company may qualify for the R&D Tax Credit or R&D Corporation Tax credit if:
- it is within the charge of Corporation Tax in Ireland
- it carries out qualifying R&D activities in Ireland, the European Economic Area (EEA) or the United Kingdom (UK)
- the expenditure does not qualify for a tax deduction in another country.
Qualifying R&D activities
To qualify for the R&D Tax credit, a company’s R&D activities must:
- involve systemic, investigative or experimental activities
- be in the field of science or technology
- involve one, or more, of these categories of R&D:
- basic research
- applied research
- experimental development
- seek to make scientific or technological advancement
- involve the resolution of scientific or technological uncertainty.
How to claim
A company must use Revenue Online Service (ROS) to claim either credit on their Corporation Tax Return.
In respect of CT1 2022, a specified return is required to make a claim to:
- accelerate second and last instalments brought forward
- and, or
- claim an R&D Corporation Tax Credit.
The specified return must be filed through MyEnquiries in ROS. To file the specified return, click on MyEnquiries and select the category:
- ‘Corporation Tax (CT)’
- the subcategory ‘CT R&D specified Return’.
The company must ensure that the R&D claim meets all the requirements before applying.
Claims must be made within 12 months from the end of the accounting period in which the expenditure is incurred.
Revenue's Research and Development Corporation Tax Guidelines
For further information, please see the Research and Development Tax Credit manual.