France’s Crédit d’Impôt Recherche (CIR) is a federal R&D incentive designed to support business innovation by reducing the effective cost of research activities. Established in 1983 and continually updated, the CIR allows companies to claim a tax credit of 30 percent of qualifying R&D expenditures for the first €100 million (~$108m USD) and 5 percent for expenses above that threshold. For small and medium-sized enterprises (SMEs), a portion of the credit is refundable in cash, enabling firms with limited taxable income to access immediate financial benefit. This post explores how the CIR works, including qualification criteria, eligible costs, calculation methods, refundability, documentation requirements, and comparisons to the U.S. federal R&D tax credit.
(more…)Tag: technology
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Incentives That Work: Germany’s R&D Research Allowance (Forschungszulage)
In recent years, Germany introduced a new federal R&D incentive known as the Research Allowance (Forschungszulage) to support business innovation. Prior to this change, Germany historically offered generous direct grants for research projects but had limited tax credits. The Research Allowance Act (Forschungszulagengesetz), which came into effect on January 1, 2020, now provides companies of all sizes with a refundable tax credit for qualifying research and development activities. This post explores how the Research Allowance works, including qualification criteria, how the credit is calculated, documentation requirements, payout mechanisms, and how it compares with the U.S. federal R&D tax credit.
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Beyond The Tradeoff 