Changes in R&D Settlements? Check Whether It’s Worth Applying the Relief Now
Meanwhile, you can apply the R&D relief in your annual tax return - not only for the current year but also retroactively for previous years. This means that even if you haven’t used this incentive before, you can still include your development costs and gain real tax savings.
What is the R&D Tax Relief?
The R&D tax relief allows companies to deduct expenses related to research and development activities. You don’t need a formal R&D department - in many cases, qualifying activities happen naturally as part of daily work, e.g., in IT, manufacturing, construction, or e‑commerce.
In practice, many companies introducing new solutions, improving processes, or testing prototypes may already qualify. What matters most is proper documentation of activities and costs - this is the key to including them in the annual tax return and benefiting from actual tax savings.
How the R&D Tax Relief Works
The R&D Tax Relief allows companies to deduct qualifying R&D costs not only as standard tax-deductible business expenses but also as an additional deduction, resulting in real tax savings in the annual return.
- Up to 200% of salaries - you can deduct twice the salaries of employees (including contractors) involved in R&D activities.
- Up to 100% of other costs - including materials, raw materials, equipment, and external services used in R&D projects.
Costs incurred in connection with R&D activities may be included in the tax return under the R&D relief, provided they are properly documented and meet the eligibility criteria defined in the CIT Act.
See also: Country-by-Country Reporting 2026 - an important obligation approaching
R&D Tax Relief in the Annual Tax Return
The R&D relief is settled in the annual CIT or PIT tax return, which means it does not require a separate declaration during the tax year. As a result, the taxpayer can reduce the tax base by both the standard deductible costs and the additional R&D deduction - ultimately lowering the tax due for that year.
Moreover, the regulations allow companies to apply the relief retroactively by submitting a corrected tax return. In practice, this means adjusting tax returns for the past five tax years. Even if the company has never used the R&D relief before, it may still include qualifying costs from the last five accounting periods and recover potential tax overpayments.
Conditions for Applying the R&D Tax Relief
To benefit from the R&D relief, the following conditions must be met:
- Conducting R&D activities - actions must meet the definition of R&D under the CIT Act, and do not have to result in a new product or process.
- Incurred qualifying costs - including employee remuneration (also under civil contracts), materials, raw materials, equipment, and external services used in R&D.
- Proper documentation - companies must maintain records confirming expenses and their link to R&D activities.
- Recognition of costs in a given tax year - costs must be reported in the year they relate to, with the option to correct tax returns for up to 5 previous years.
How We Support You in Applying the R&D Tax Relief
If you are considering whether your company qualifies for the R&D relief or you want to settle it safely in your annual return, we offer comprehensive support at every stage:
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The most important elements include: timesheets, project documentation, and separate accounting of R&D-related costs. Good practice includes maintaining project descriptions and detailed work schedules.
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