The Irish government on December 14 released an updated version of its tax manual on the research and development (R&D) tax credit, clarifying certain matters for small and micro companies.
In general, the R&D tax credit manual describes the requirements to qualify for the credit, how to calculate the credit, types of qualifying research, qualifying expenditures, subcontracting rules, and valid claim requirements.
The update specifies that the finance minister has not yet commenced measures to enhance the R&D tax credit for small and micro companies, and claims must be made in accordance with the legislation currently in effect.
For claims that have been incorrectly made based on a 30% rate for small and micro companies that is not currently available, the government will allow the claims at the permitted 25% rate, provided other conditions for claiming the credit are met. Otherwise, claims beyond what the legislation currently allows will be clawed back.
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