Get Application Form Approval Organization for the French Research Tax Credit

The Competitiveness and Employment Tax Credit (CICE) was introduced in 2013. It is a tax credit that most companies can benefit from, irrespective of their sector of activity, and is based on gross wages paid in the course of the year up to 2.5 times the minimum wage.

The tax credit rate for R&D expenditure is 30% of outlays up to €100 million per year, and 5% over this limit. The tax credit rate for innovation expenditure is 20% of the eligible outlays up to a maximum of €400,000 per year. In certain cases, the tax credit rate may be more than 100% of the research expenditure.

The federal research and development (R&D) tax credit results in a dollar for dollar reduction in a company's tax liability for certain domestic expenses. Qualifying expenditures generally include the design, development or improvement of products, processes, techniques, formulas or software.

CIR accreditation is a system implemented by the Ministry of Research and Innovation to allow companies to reduce their subcontracting and research costs by up to 40% in certain cases (see General Tax Code, article 244, quater B).

Who qualifies for the R&D credit? Any company engaged in activities to develop or improve products, processes, software, formulas, techniques or inventions in a way that required some level of technical experimentation to determine the most accurate and appropriate design may qualify for the R&D credit.

The tax credit is equal to the amount of French tax corresponding to the foreign-source income. The amount of income before deduction of the tax paid abroad must be declared on return no. 2047 and reported in the relevant sections of the income tax return depending on the type of income.

Businesses can claim the R&D Credit by filing IRS Form 6765, Credit for Increasing Research Activities.

The tax rebate can be granted to projects that incur €250,000 or 50% of their world budgets in French expenditures and, for a live action work, have at least 5 days of shooting in France.