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Tax incentives for R&D (SIFIDE) with new application deadline until June 30

This post is also available in: Português (Portuguese (Portugal))

Companies with research and development activities now have another month to recover part of that investment by deducting IRC collection.

The submission of applications to the Tax Incentive System for Business R&D (SIFIDE), a system managed by the National Innovation Agency (ANI) and contained in number 3 of article 40 of the Investment Tax Code, relating to to the fiscal year 2020, it can be done until the end of the 6th month of the year following that of the period of 2020, without any additions or penalties. This means that companies can submit their application for the 2020 fiscal year until June 30, 2021.

The extension of the application deadline was determined through a joint order issued by the Ministry of Economy and Digital Transition, the Ministry of Science, Technology and Higher Education, and the Ministry of Finance, dated May 3, 2021.

This decision comes within the scope of several orders issued with a view to easing the timely compliance with tax obligations and the important set of measures to support families and companies announced by the Government to mitigate the effects of the COVID-19 pandemic, as well as aiming at strengthening the principle of mutual collaboration and mechanisms that facilitate voluntary fulfillment of obligations and the granting of benefits.

SIFIDE aims to increase the competitiveness of companies by supporting their efforts in Research & Development (R&D), by deducting from the IRC collection a percentage of their respective R&D expenses (in the part not reimbursed by the State or European Funds) .

Between 2006 and 2019, 16,251 applications to SIFIDE were received, submitted by 4,430 companies. The investment in R&D declared in these applications was 9,458.5 million euros (M €), with tax credits amounting to 3,455.4 M € being requested. In the last decade, 3,574 companies have already recovered 2,147 million euros from the investment made in R&D. 122 thousand euros per year was the average savings of SMEs in the last five years, through tax incentives to R&D, and a company can recover up to 82.5% of the investment made in R&D.

This incentive covers: 1) research expenses, those incurred by the IRC taxpayer with a view to acquiring new scientific or technical knowledge; 2) development expenses, those incurred by the IRC taxpayer through the exploitation of results of research work, or other scientific knowledge, or even technical, with a view to discovering or substantially improving raw materials, products, services or processes of manufacture.

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