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Refundable research tax credits
Summary of key criteria
The below countries in the 2015 Global Survey of R&D Incentives Survey, all offer refundable research tax credits.
SMEs are eligible for a refundable tax credit of 45 percent of qualified research expenses (QREs), but QREs are not deductible. SMEs are entities with gross receipts of less than AUD 20M that are not more than 50% controlled by exempt entities.
A refundable 12 percent volume based tax credit is available for all taxpayers to the extent the credit exceeds the amount of the company’s tax liabilities (10 percent for fiscal years commencing before 1 January 2016).
Excess tax deductions may be converted into a tax credit refundable after five years if not utilized.
35 percent federal ITCs for small Canadian-controlled private corporations (CCPCs) on up to CAD 3M of qualified expenditure per year. This limit applies to all corporations in an associated group. The corporate group of companies must have less than CAD 800K of taxable income and less than CAD 50M in taxable capital employed in Canada (TCEC) to qualify for the refundable ITCs. These caps are based on the prior year.
If research tax credits are not utilized within three years, the taxpayer receives a refund for the unutilized credit.
Unused credits may be carried back one accounting period and carried forward indefinitely. If there are unutilized credits after the carryback, the taxpayer may apply for a refund (payable over three years), subject to certain limitations and caps.
There is an option to convert up to SGD 100K of tax deductions into a non-taxable cash grant for each qualifying tax year from 2013 to 2018 at the rate of 60 percent (i.e., SGD 60K).
The requirements that must be met to qualify for refundable credits limit opportunities for refunds.
Cash credits are available for SMEs in a loss position, up to 33.35 percent of qualified expenditure. Large companies can elect to claim a taxable credit of 10 percent, increased to 11 percent from 1 April 2015.
See other summaries of key criteria
- Location of IP may impact research incentives
- Qualified research must be performed within the country
- Countries that allow some research to be performed outside the country
- Countries that permit qualified research activities to be performed outside the country without any restriction
- Qualified contract research allowed
- Treatment of income and expenses related to IP
- Countries offering research grants only