Budget Law 2022: the extension of the R&D credit - Technology innovation - Design and aesthetic ideation

The 2022 Budget Law, published in the Official Gazette of 31 December 2021, n. 310 - Suppl. Ordinary n. 49, has extended and remodeled the tax credit for investments in research and development, in technological innovation, in technological innovation 4.0 and in design and aesthetic conception.

R&D

R&D activities include fundamental research, industrial research and experimental development in science or technology [1]. The costs related to these activities can be subsidized to an extent equal to 20% of the costs up to € 4 million for 2022 and 10% of the costs up to € 5 million from 2023 to 2031.

Technological innovation

Technological innovation activities are those aimed at creating new or substantially improved products or production processes [2]. The costs are eligible for 10% of the costs up to € 2 million for the years 2022 - 2023 and to an extent equal to 5% of the costs up to € 2 million for the years 2024 - 2025.

Technological innovation 4.0

The activities of technological innovation 4.0 are those aimed at creating new or substantially improved products or production processes to achieve an objective of ecological transition or digital innovation 4.0. The costs related to these activities are eligible for 15% of the costs up to € 2 million for 2022, to an extent equal to 10% of the costs up to € 4 million for 2023 and to an extent equal to 5% of the costs up to to 4 million for the years 2024 - 2025.

Design and aesthetic ideation

The activities of design and aesthetic conception are those aimed at significantly innovating the company's products in terms of form and other non-technical or functional elements. The costs are eligible for 10% of the costs up to € 2 million for the years 2022 - 2023 and equal to 5% of the costs up to € 2 million for the years 2024 - 2025.

In order to benefit from the tax credits described above, some mandatory requirements are envisaged: 

1)     The incurring of expenses and their correspondence to the accounting documentation of the company must result from a specific certification issued by the person in charge of the legal audit of the accounts. For companies not required to carry out statutory audits, the costs for the accounting certification are recognized as an increase in the tax credit for an amount not exceeding € 5,000.

2)     Drafting and storage of a technical report that illustrates the purposes, contents and results of the eligible activities carried out in each tax period in relation to the projects in progress. This report must be prepared by the company manager of the eligible activities or by the individual project manager and must be countersigned by the legal representative of the company.

The use of the credit can only take place in offsetting, in 3 annual installments of the same amount, starting from the tax period following that of accrual and only in case of fulfillment of the certification obligations.

Another aspect of considerable importance is that the tax credit is not subject to the limits of annual use of tax credits from the RU framework, equal to € 250,000 (art. 1, c. 53 L. 244/2007) and to the general compensation limit in mod. F24, equal to € 2,000,000 (Article 34 of Law 388/2000).

Finally, it is important to underline that the benefit can be combined with other concessions on the same eligible costs, within the limits of the total cost. However, in order to avoid undue benefits due to the accumulation, the credit calculation basis, on which the envisaged percentages are applied, is assumed net of other contributions for any reason received for the same eligible expenses (including the new Patent box).

Artur Michal Moch

Chartered accountant

For any other information, please contact Rogai & Partners stp Srl

www.studiorogai.it

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