18 December 2025

Tax Reliefs, part 4: R&D tax relief

For personal income tax payers (PITs) who are subject to a flat tax rate, as well as corporate income tax payers earning income from sources other than capital gains, there is a mechanism that permits an additional deduction from the taxable income for eligible costs associated with R&D tax relief.

According to the regulations, research and development activities are defined as creative activities involving scientific research or development work undertaken systematically to increase knowledge and apply it to create new, innovative solutions. R&D activities include:

• Fundamental research – empirical or theoretical work primarily aimed at acquiring new knowledge about the foundations of phenomena and observable facts without any direct commercial application;
• Applied research – work aimed at acquiring new knowledge and skills, aimed at developing new products, processes, or services, or introducing significant improvements thereto.
• Development work – activities involving the acquisition, combination, shaping, and use of currently available knowledge and skills, including IT tools or software, for production planning and the design and creation of altered, improved, or new products, processes, or services, excluding activities involving routine and periodic changes to them, even if such changes constitute improvements.

From a practical perspective, research and development activities can include areas such as: developing new technologies and solutions (of a prototype nature), developing new applications/software and introducing significant improvements to existing solutions, developing prototype solutions (at the client’s request), even if they are incidental (as a one-off order). Research and development activities can occur in any industry, starting with IT and extending even to industrial sectors.

Under the R&D tax relief, eligible costs include:

• salaries of employees under an employment contract or civil law
• contracts (contract of mandate or contract for specific work), along
• with social security contributions – in the portion related to R&D activities;
• expenditures on the purchase of specialized equipment and expenses for materials and raw materials directly related to R&D activities; Expenditures on expert opinions, consultancy services, and equivalent services provided or purchased from scientific and research institutions,
• expenditures on the paid use of research equipment and expenses for the purchase of services related to the use of research equipment – ​​used exclusively for R&D activities,
• costs of obtaining and maintaining patents, utility model protection rights, and industrial design registration rights,
• Depreciation deductions on fixed assets and intangible assets used for R&D activities, excluding passenger cars and structures, buildings, and premises that are separately owned.

The deduction rate for the R&D tax relief is 200% for personnel salaries and 100% for other eligible costs. Importantly, these costs must be tax-deductible costs. Furthermore, they cannot be reimbursed in any form and cannot be included in the calculation of exempt income (in connection with Special Economic Zones or PSI).

It is important to prepare appropriate cost documentation to settle the R&D tax relief. It is acceptable to maintain records in the form of supporting records (e.g., Excel spreadsheets), as well as to prepare appropriate project documentation (e.g., project cards), so that the tax authority has no doubts about the validity of the R&D tax relief.

The tax relief is settled in the annual tax return (including through an amended return) by completing the appropriate appendix to the return (PIT/BR for PIT taxpayers, CIT/BR for CIT taxpayers). Furthermore, the regulations regarding the R&D tax relief allow for the deduction of eligible costs in the next six tax years, following the tax year in which the taxpayer initially settled the R&D tax relief (and is unable to fully utilize the eligible costs due to the amount of income or a loss).

Importantly, every entrepreneur can potentially benefit from the R&D tax relief – and the benefits of using the R&D tax relief are numerous, including:

• improved financial liquidity,
• lower taxes,
• more funds for investments,
• increased competitiveness of the company’s products and services,
• increased innovation.

At ARPI Accounting, we can prepare an analysis of ongoing projects in terms of research and development activities and assist in implementing the R&D tax relief – contact our experts.