Revenue eBrief No. 085/26

23 April 2026

Research and Development (R&D) Corporation Tax Credit

Tax and Duty Manual (TDM) Part 29-02-03 has been updated to reflect changes to the R&D tax credit introduced by Finance Act 2025.  The changes are reflected throughout the manual, with new examples included, where appropriate.

Key changes include:

• increase in the rate of the credit from 30% to 35%,
• increase in the first instalment threshold amount from €75,000 to €87,500, 
• an administrative simplification measure allowing 100% of an employee’s emoluments to be included as qualifying expenditure where that employee performs at least 95% of their duties in the carrying on of qualifying R&D activities,
• a clarification that expenditure incurred on the construction of a qualifying building includes expenditure incurred on the construction of a laboratory to be used in the carrying on of qualifying R&D activities.

For accounting periods commencing on or after 1 January 2023, claims for the R&D tax credit are required to be made under section 766C and/or section 766D Taxes Consolidation Act (TCA) 1997.  Therefore, material in relation to claims for the R&D tax credit under section 766 and section 766A TCA 1997, together with associated examples, have been removed from this TDM.  Please refer to ‘Show older versions’ on the R&D TDM page on the Revenue website for guidelines in relation to claims for the R&D tax credit under section 766 and/or 766A TCA 1997.