Tax credit for research, development, innovation and design (Italian acronym: CIRSID)
The Research, Development, Innovation and Design Tax Credit (CIRSID) is the evolution of the incentive introduced by the 2015 Budget Law (Law 190/2014), one of the most appreciated by Italian companies, as it supports a driver of growth and competition, represented by the ability to bring new products and services to the market, to develop new business models or experiment with new process solutions.
It is aimed at all companies resident in the territory of the State, including permanent establishments of non-resident subjects, regardless of the legal nature, the economic sector to which they belong, the size, the accounting regime and the system for determining income for tax purposes.
The activities that the Research, Development, Innovation and Design Tax Credit supports, with the related tax credit percentages, are:
The expenses eligible for the Research, Development, Innovation and Design Tax Credit are as follows:
- Expenses for personnel with a subordinate or self-employment relationship or other relationship other than subordinate work. Furthermore, an increase in the incentive is envisaged for highly qualified personnel aged no more than 35 years, on their first job, hired by the company with an open-ended employment contract and employed exclusively in eligible activities;
- depreciation charges, finance lease or simple lease payments and other expenses relating to movable tangible assets and software, for the amount ordinarily deductible for the purpose of calculating business income relating to the tax period of use;
- expenses for contracts concerning the direct performance by the commission agent of the activities eligible for the tax credit. An increase in the benefit is envisaged in the case of extra muros R&D contracts stipulated with universities and research institutes based in the territory of the State or, by virtue of the Relaunch Decree, with innovative start-ups;
- (for R&D activities only) depreciation charges relating to the purchase from third parties, also under license, of industrial property rights relating to an industrial or biotechnological invention, to a semiconductor product topography or to a new plant variety, in the total maximum limit of 1,000,000 euros and on condition that they are used directly and exclusively for carrying out the activities related to the eligible R&D projects;
- expenses for consultancy services and equivalent services;
- expenses for materials, supplies and other similar products.
Only for companies not required by law to carry out statutory auditing of the accounts, the expenses incurred to fulfill the obligation to certify the accounting documentation are recognized as an increase in the tax credit, for an amount not exceeding 5,000 euros.
The facilitation of movable tangible assets and software, consultancy services and materials is related to the amount of personnel expenses referred to in letter a) and/or contracts referred to in letter c).
CONSULTING AND ASSISTANCE SERVICE
What we can do for you
- We monitor and assess opportunities for subsidies and concessions available for specific research, experimental development, innovation, and design projects;
- we analyse the economic, technical, and financial documents (provided by your company) needed to identify and report expenses incurred for these projects;
- we produce a technical file illustrating your research, development, innovation, and design projects, we report the relating expenses, distinguishing between those which are eligible and ineligible for the incentive, and we describe the level of innovation of your projects, highlighting the state of knowledge compared to that reached or attempted by other parties. In the latter case, we also check whether existing information on the process or product is accessible and available to the company or not;
- we produce a report (sworn before a court) and prepare the addendum to the management report and/or to the financial statements;
- we guarantee the assistance of an expert appointed by us, in the event of any checks regarding the existence and adequacy of the research and development costs identified.
How we do it
By putting a team of specialists at your disposal to accompany you in the management and use of this interesting incentive, in particular:
- a commercial consultant with specific expertise, who - after running an initial check to establish the possibility of accessing the 2020 tax credit or on the need/advisability of verifying tax credit already utilised - will coordinate subsequent activities and be responsible for your satisfaction;
- our Research Department, which investigates every aspect of the legislation and monitors all updates; the Research Department studies the circulars, FAQs, resolutions, and interpretations of the Inspection Authorities, updates the commercial and technical consultants and discusses the issues with the internal team that specialises in the measure in question;
- the R&D tax credit technical team, which monitors the progress of the applications to ensure every form is filled in on time and provides the technician assigned to the company with support for the more complex aspects;
- a dedicated technician (usually an engineer), who liaises with the client in the handling of the incentive; the technician will also be in charge of preparing the sworn report;
- a Customer Services Department, for administrative aspects and gathering paperwork.
Did you know that there are certain concessions that can be combined with the research and development tax credit?