Eligibility criteria for the research tax allowance

Is your business eligible?

Company with innovative activities and based in Germany have since 2020 legal entitlement to request the research allowance. Eligible activities include the research and development activities undertaken by the company according to the "Frascati Manual", that achieve novel products, services or processes. The research allowance is used to finance company-internal personnel expenses or costs for external services undertaken within the framework of R&D activities.

Which Costs become promoted?

Eligible activities

Eligible activities refer to the R&D definition of the EU General Block Exemption Regulation and the Frascati Manual. They are novel, creative and, in terms of outcome, risky activities that are carried out systematically and are reproducible. The detailed funding guidelines can be found in the BMF-Guidelines.

These activities fall into the following three areas:

Industrial research

Acquisition of new knowledge and skills for the development of new products or for a significant improvement of existing products.

Experimental research

Acquiring, combining, shaping, and using existing knowledge and skills with the goal of developing new or improved products

Basic research

Acquire new knowledge without direct commercial application or use in mind.

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