Tax authorities in their individual interpretations take the position that remuneration of employees performing research and development projects cannot be fully included in eligible costs if in a given month the employee was on leave, sick leave or otherwise on excused absence. The above applied also with respect to the case in which the analysed judgment was issued. The director of the National Revenue Administration Information Centre (KIS) recognized the taxpayer's position as incorrect.
In the tax authority's view, for the purposes of calculating the deduction under the R&D relief, any amounts of remuneration and contributions of the employee which proportionally fall on days and periods of absence from work (including those due to leave or other excused absence) should be excluded.
The appealed interpretation was submitted to the Voivodship Administrative Court in Szczecin, which recognised the position of the director of the KIS as incorrect. The director of the KIS appealed to the NSA, which ultimately settled the case by upholding the verdict of the Voivodship Administrative Court in Szczecin, which was advantageous to the taxpayer.
The above judgment is the first NSA ruling regarding recognition of the remuneration for the time of absence as a qualified cost. It should be hoped that subsequent NSA judgments will also be favourable, which will ultimately change the tax authorities' approach.
Judgment of the Supreme Administrative Court: (ref. II FSK 1038/19)
Learn more: R&D relief: maximum deductions allowed
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