In Budget 2020, I provided for the introduction of a number of enhancements to the R&D tax credit for micro and small companies, including an increase in the rate of credit and an enhanced method of calculating the payable credit.
These measures were introduced subject to a Commencement Order pending State aid approval from the Commission, given the targeted nature of the measures towards micro and small companies.
Officials in my Department initiated contact with the Commission last year on this matter and internal discussions are ongoing – progress has been hampered to some extent by Covid-related lockdowns. Therefore, the measures for micro and small companies have not yet been commenced.
The Programme for Government – “Our Shared Future” – recognises the importance of research, development and innovation as these are recurring theme across a number of the mission aims. Specifically in relation to Small Business Taxes, there is a commitment to continue to encourage greater take-up of the R&D Tax Credit by small domestic companies, by building on recent changes and examining issues with respect to the preapproval procedures and reduced record keeping requirements.
These issues will be examined by my Department, in conjunction with other Departments and stakeholders, in due course.