Push pins

Perspectives

Global investment and innovation incentives updates: May 2018

Global developments benefiting business

This monthly publication provides a summary and updates on the latest global developments in research and development (R&D) credits, grants, and other incentive arrangements. More than 50 countries offer specific incentives and this newsletter focuses on identifying and outlining what could be the right incentives for your organization.

Australia

Research and development (R&D) regime updates

The federal budget presented on 5 May 2018, includes proposals that would make significant changes to Australia’s R&D tax incentives regime. If approved, the new measures would apply for income years commencing on or after 1 July 2018.

For companies with aggregated annual turnover of AUD 20 million or more, an R&D premium would be introduced that ties the rates of the non-refundable R&D tax offset to the incremental intensity of R&D expenditure as a proportion of total expenditure for the year. The marginal R&D premium would be the claimant’s company tax rate plus:

  • Four percentage points for R&D expenditure between 0 percent to 2 percent R&D intensity;
  • 6.5 percentage points for R&D expenditure above 2 percent to 5 percent R&D intensity;
  • Nine percentage points for R&D expenditure above 5 percent to 10 percent R&D intensity; and
  • 12.5 percentage points for R&D expenditure above 10 percent R&D intensity.

In essence, companies with a low R&D intensity would receive a reduced benefit going forward (the net tax benefit currently is 8.5 percent for companies with turnover of AUD 20 million or more).

In line with the rate changes, the R&D expenditure threshold would be increased from AUD 100 million to AUD 150 million per annum.

For companies with aggregated annual turnover below AUD 20 million, the refundable R&D offset would be a premium of 13.5 percentage points above a claimant’s company tax rate. Cash refunds from the refundable R&D tax offset would be capped at AUD 4 million per annum. R&D tax offsets that cannot be refunded would be able to be carried forward as non-refundable tax offsets to future income years.

Refundable R&D tax offsets from R&D expenditure on clinical trials would not count towards the cap.

The government intends to improve the integrity of the R&D program by implementing stronger compliance and administrative improvements. These improvements include increased resourcing for the Australian Taxation Office (ATO) and Department of Industry, Innovation and Science that will be used to undertake greater enforcement activity and provide improved program guidance to participants. Other changes include improving the transparency of the program by enabling the ATO to publicly disclose claimant details and the amount of R&D expenditure claimed, limits on time extensions to complete R&D registration and amendments to technical provisions (e.g. claw back rules and the general anti-avoidance rules).

Austria

Quantum research and technology

With a budget of approximately EUR 4.2 million, the Austrian Research Promotion Agency offers support for cooperative R&D projects on the following topics: quantum communication, quantum simulators, quantum metrology and sensors, quantum computers, and other areas of quantum science and technology. Funding is up to EUR 2 million and may be up to 85 percent of qualifying costs.

With a budget of approximately EUR 1.4 million, the Austrian Science Fund offers support for postdocs. Research centers can cooperate with companies involved in the field of quantum research, and apply for staff costs of postdocs for up to a maximum period of three years. For the period of the funding, the postdoc is 75 percent sent to the cooperating company.

Scheme budget EUR 5.6 million
Type of incentive Grant for industrial research and experimental development
Deadline 20 June 2018

Contact your Austria representative

Herbert Kovar,
partner
+431 537 003 600

Jan-Martin Freese,
manager
+431 537 007 770

Germany

Funding program “Internet-based services for complex products, production processes and systems (smart services)”

Smart services change traditional business models of leading industries in Germany, such as automotive and mechanical engineering, chemicals, electrical and medical technology, logistics, and energy technology. The current funding opportunity supports companies during this time of transition.

Examples of potential R&D projects include:

  • Concepts and technological approaches for virtual reality and augmented reality applications in the service environment
  • Linking assistance systems with production planning and control systems to generate flexible instructions
  • Bundling of products with Internet-based and physical services, as well as digital revenue and business models for product services systems (e.g. performance contracting, power-by-the-hour, pay-per-X, etc.)
  • Development and testing of integrated smart service platforms (e.g. for the provision of extended service information of a machine manufacturer)
  • Integration of software services in the product development phase and usage (e.g. crowd services for testing and support of complex products)
Scheme budget Universities, other research institutions, and companies of all sizes can apply in consortia

Funding for companies can be up to 50 percent of eligible costs
Type of incentive Non-repayable cash grant
Deadline(s) 27 July 2018 (first stage)

Funding program “Tailor-made bio-based ingredients for a competitive bio economy”

The objective of this funding program is to support excellence and innovation-driven interdisciplinary R&D work using the innovation potential of the synthesis performance of biological systems. The program supports both fundamental research and application-oriented inter- and trans-disciplinary projects.

Projects may focus on using biological resources as biochemical "factories"—ideally in combination and cascade use—for the production of tailor-made bio-based ingredients. Areas for application range from food and medicines to chemical components for industrial products.

Scheme budget Universities, other research institutions, and companies of all sizes can apply in consortia

Funding for companies can be up to 50 percent of eligible project costs
Type of incentive Non-repayable cash grant
Deadline 23 July 2018 (first stage)

Contact your Germany representative

Isabel Antholz
service line leader
+49 (0) 40 32080 4910

Poland

Support for investment in R&D infrastructure of enterprises (Measure 2.1 Smart Growth Operational Program)

Administered by the Ministry of Development, Measure 2.1 is dedicated to the support of the creation and development of R&D centres. The program is addressed to enterprises complying with National Smart Specializations and cooperating with SMEs or research institutions.

Scheme budget PLN 350 million
Type of incentive Cash grant

Intensity may range from 10 percent to 70 percent of eligible costs, depending on the type of work, company size, and location of the project

The grant is available for the following expenditure:

R&D infrastructure and equipment

Construction work and materials

Installment payments under a real estate lease/purchase of real estate (up to 10 percent of all eligible costs)
Deadline 6 July 2018

Back to top

Contact your Poland representative

Dominika Orzolek,
senior manager
+48 881 950 969

Portugal

Incentives for technology R&D (co-promotion projects)

A non-refundable incentive is available to support co-promotion projects promoted by companies and non-profit organizations in the research and innovation (R&I) system where the projects fall within the priority areas of the national and/or regional R&I strategy for a smart specialization.

The leader of the consortium must guarantee at least 30 percent of the eligible investment, with the minimum investment amount being EUR 150,000.

Scheme budget EUR 47.5 million
Type of incentive Companies:

Non-refundable incentive up to EUR 1 million per beneficiary

Where the incentive exceeds EUR 1 million, the following apportionment applies: 75 percent of the incentive is non-refundable and 25 percent is refundable, without interest

The support rate ranges from 25 percent to 80 percent of eligible expenditure

Non-for-profit organizations of the R&I:

Non-refundable incentive

The support rate is calculated according to the average support rate of the beneficiary companies
Deadline 18 May 2018

Contact your Portugal representative

Sérgio Paulo Oliveira,
partner
+35 1 21042 7527

For more information

For more information on any of the programs listed above, please contact the in-country representative or your usual contact.

Subscribe to receive Global investment and innovation incentives updates directly via email.

Global investment and innovation incentives updates: Global developments affecting research and development

Fullwidth SCC. Do not delete! This box/component contains JavaScript that is needed on this page. This message will not be visible when page is activated.

Did you find this useful?