Romania
Research and Development Tax Incentive
Romania offers a variety of R&D incentives in the forms of deductions, exemptions and grants. The Romanian R&D Tax Incentive was created to promote innovation and research and development activities within the country. Romania offers a 150% super deduction for eligible R&D expenses, as well as a corporate income tax exemption for ten years.
Description of Incentive
In addition to the 150% super deduction for qualified research expenses, accelerated depreciation of up to 50% of the monetary value of the property can be applied for devices and equipment used in R&D projects.
As of January 1, 2017, salary income obtained as a result of conducting research and development activities is free from Romanian corporate income tax for the first ten years.
Eligibility Requirements
All industries and taxpayers may qualify for the super deduction as long as they are performing qualified R&D activities. Activities must be creative and innovative with the purpose of resolving scientific or technological uncertainty to be considered an eligible activity.
Eligible R&D expenses include:
- Expenses incurred in connection with salaries of personnel directly involved in R&D
- Depreciation expenses of new tangible and intangible assets used in R&D activities and related expenses
- Operating expenses including costs of materials and products used in R&D activities
- Overhead expenses
R&D activities can be performed in Romania or in any EU/EEA countries to qualify for the incentive.
Other Considerations
Romania grants tax incentives separately for each R&D project. Documentation describing the project, its objectives, the innovative aspects, the time period of the project, financing and field of research must readily available in the case of an audit.
Services
Swanson Reed offers the following services:
- Advice on tax preparation relevant to claiming the R&D tax credits incentive
- Preparation of documents relating to filing and substantiating a R&D taxation claim
- R&D tax advice and consultations
- R&D tax claim planning and preparation
For a full range of services in relation to the credit, please click here.
