Research and Development Tax Credit: A Significant Reduction in Tax Liability for Your Company
Does your company develop its own products, technologies, or software? You are very likely legally entitled to a research and development tax credit.
This is not a traditional subsidy: the deduction can be claimed annually, for multiple projects simultaneously, with no allocation limits and no need to compete with other companies. This represents a direct reduction in the tax base of up to 150% of eligible research and development costs, with no restrictions based on industry or company size. For every million crowns spent on development, you can save up to 315,000 CZK in taxes!
The deduction can be claimed across all sectors, whether it involves the development of new products, materials, or manufacturing processes; the construction and testing of prototypes; the development of software, algorithms, or new technologies; pilot operations; clinical trials; or research into new methods and procedures in the service sector.
What matters is not the field, but the presence of technical uncertainty and an element of novelty—meaning that the result is not guaranteed in advance and brings something the company could not previously do or did not have.
Who can apply?
- Provided legislative requirements are met, any company, regardless of its size, location, or industry, has a legal right to apply.
What can be included in eligible expenses?
- labor costs (including administrative and support staff)
- depreciation of tangible and intangible assets
- operating costs (materials, energy, minor tangible and intangible assets)
- travel expenses
- contract research and intangible R&D results from a public university or research organization
- services related to compliance verification
- financial lease payments
What is the maximum deduction amount?
- Up to 150% of eligible costs incurred for R&D projects can be deducted from the tax base (up to a limit of CZK 50 million per tax period); above this limit, 100%
- Can be utilized annually, repeatedly, and may be claimed for up to 5 years.
- There is no lower or upper limit.
We will help you identify suitable projects and eligible costs, handle the administration, ensure proper documentation and reporting, thereby minimizing the risk of errors. We will be with you throughout the entire project cycle.
