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Research premium – Innovations through the AbgÄG 2022

Tax News - 19 Jul 2022 | 3 minutes read

The Tax Amendment Act 2022 (AbgÄG 2022) was passed in the National Council on 7 Jul 2022 and with it the amendments to the research premium, which provide for a broadening of the tax base but also advantages in the application deadlines.


Fictitious entrepreneurial wage

Under the previous legal situation, no research premium was available for research services provided by partners in a partnership or (entirely) unpaid partners in a corporation, as the research services provided by the partners themselves were not to be taken into account. This was particularly disadvantageous for start-ups and SMEs.

According to the new regulation and the amendment of the Research Premium Ordinance (Federal Law Gazette II 2022/302), which regulates the assessment basis of the research premium, a fictitious entrepreneurial wage for research and experimental development can in future also be included as an expense in the assessment basis of the research premium. This amounts to

  • for sole proprietors, co-entrepreneurs and unpaid partners of a corporation to EUR 45 for each hour of activity in beneficiary research and experimental development performed in the business year,
  • but not more than EUR 77,400 for each person per business year.

The prerequisite for this is that the activity is proven on the basis of time records with a meaningful description. Therefore, valid documentation must be ensured, mere credibility is not sufficient.


Extended deadline to apply for the premium

The application period for the research premium was newly regulated and decoupled from the legal force of the income tax, corporate income tax or assessment notice.

The application period begins unchanged with the end of the (last) business year to which the expenses (expenditures) and costs included in the assessment basis are to be allocated, and now ends four years after the beginning.


Setting the premium in stages

Upon application, the tax office may determine the research premium for in-house research and experimental development with regard to a factually delimited part of the premium application (one research project, several research projects and/or one research focus, several research focuses) by means of a separate notice.

The prerequisite for such a partial determination is that it is to be expected that the decision on the premium application will be significantly delayed.

In the draft version, application was planned for the first time for research premiums in 2022. However, in the AbgÄG 2022, which has now been passed, there is no longer any express provision for the premium to come into force in stages. It can be deduced from this that as of the entry into force of the Act (i.e. 19 Jul 2022, the day of the promulgation of the AbgÄG 2022 in the Federal Law Gazette), an application for a partial decision should be possible for all premium procedures that are still open.


Entry into force of the new regulations

With the exception of the regulation on the partial decision on a premium application, the above-mentioned provisions (fictitious entrepreneurial wage, extended 4-year application period) are applicable to research premiums 2022 that are applied for the first time after 30 June 2022.

This means – in contrast to the draft version of the AbgÄG 2022 – that the new provisions mentioned above do not apply to research premiums 2022 already applied for by 30 June 2022 (assumes a different fiscal year 2021/2022).