Recording a loss vs. accounting for R&D relief
If a taxpayer incurs a loss when the amount of income earned in a given tax year is less than the amount of the deduction to which he is entitled under the relief, then the deduction of qualified expenses shall be made consecutively in the entire amount or in the remainder in the tax returns for the consecutive 6 tax years immediately following the year in which the taxpayer was entitled to the relief.
In making the deduction referred to above, he shall take into account the deductions made to date under the employee innovation allowance. Deducting the costs in the following six years is one of two options for accounting for the deduction if a loss is recorded. An alternative for some entrepreneurs is a cash refund, which has been provided for some taxpayers, i.e. those who were not able to take the full deduction under the relief in the year of starting their business and in the following year (immediately following the year of starting their business) under the additional condition of being a micro, small or medium entrepreneur.
In practice, the above-mentioned taxpayers may claim a “cash” refund of the reported eligible costs, but they must remember that such a refund constitutes de minimis aid (in other words: state aid). It is a matter of such importance, because when requesting such a refund, the taxpayer must bear in mind that the receipt of such aid may in the future prevent him from obtaining other types of aid or grants, one of the conditions for the use of which may be the requirement not to have received de minimis aid within a certain number of years.
In addition, the “cash” phrase in question does not apply to taxpayers that were, inter alia, created as a result of certain reorganization activities such as, inter alia, transformation, merger, division, and as a result of the creation by legal entities, individuals or organizational units that contributed to the capital of that taxpayer an enterprise or an organized part of an enterprise with a value exceeding EUR 10,000.
We would also like to point out that when deciding whether to take advantage of this type of relief settlement, it is important to note that in the event that, before the expiration of three tax years, calculated from the end of the tax year for which the refund in question was made, the taxpayer who took advantage of this mechanism goes into bankruptcy or liquidation will be obliged to return the amount indicated.