Austria
Depending on individual circumstances, several tax advantages aiming at inter alia tech companies may be available.
Brazil
Federal Law No. 11.196/2005 grants tax benefits for company which work with R&D and Technological Innovation.
In a summary, the benefits are:
(I) Deduction of operating expenses incurred with R&D designed for technological innovation;
(II) 50%-cut of Excise Tax on acquisitions of machinery, devices and instruments for R&D in technology;
(III) Full depreciation, for tax purposes, of fixed assets used for R&D in technology in the year of the assets’ acquisition;
(IV) Full amortization, for tax purposes, of intangible assets exclusively related to R&D activities aimed at technological innovation in the year of the assets’ acquisition;
(V) Deductions of operating expenses incurred with the employment of researchers and professionals exclusively dedicated to R&D.
China
A company (including a foreign invested one) qualifying as a high-tech company may enjoy a reduced corporate income tax rate of 15%.
Czech Republic
In the Czech Republic, this area is governed by GDPR. Moreover, the new Czech Law on Processing Personal Data is effective since April 2019 that specifies the general rules more in detail and lays down several differences from the general regime under GDPR. For example, controllers are relieved from certain obligations (including informing the data subjects) in case of data processing for purposes of journalism, and age limit relating to conditions applicable to child's consent in relation to information society services has been set to 15 years. Further, this adaptation legislation limits/precludes fines against public institutions.
There is no general requirement to notify planned or ongoing data processing to the Office for Personal Data Protection. The controller, however, must notify (inform) the processing to the data subjects.
Nevertheless, specific situations can occur where notification to, consultation with, or authorisation from the Office is required.
On the other hand, GDPR has introduced a notification requirement in case of a personal data breach (unless the personal data breach is unlikely to result in a risk to the rights and freedoms of natural persons). Such breaches must be notified to the Office for Personal Data Protection within 72 hours (in case this timeframe is not met, such delay has to be justified), and, depending on the severity of the breach, to the data subjects whose data have been affected by the breach.
England & Wales
Research & Development (R&D) tax relief – enhanced corporation tax relief that can either reduce a company's tax bill or provide a cash sum paid by HMRC for companies incurring qualifying expenditure on R&D projects.
For the tax year 2023/2024:
An extended definition of small or medium-sized enterprises (SME) can claim an enhanced tax deduction of up to 186% of qualifying revenue expenditure or surrender deductions in exchange for a cash payment of broadly 10% of the surrenderable loss (increased to 14.5% for loss-making R&D-intensive SMEs).
For non-SMEs, an "above the line" R&D expenditure credit (RDEC) for 20% of qualifying R&D expenditure is available. Assuming a tax rate of 25%, the cash benefit is 15%.
Patent Box regime – companies with UK or EU patents may be eligible for an effective corporation tax rate of 10% in the UK on revenues derived from qualifying patents (subject to certain requirements being met).
France
R&D tax creditsquals 30% of the R&D eligible expenses incurred during the year, up to EUR 100 million in eligible R&D expenses, and 5% beyond this amount.
Patent Box: an effective tax rate of 10% corporation tax for qualifying revenues and under certain condition.
Germany
No special tax regime or tax benefits.
Hong Kong
No special tax regime or tax benefits.
Hungary
Tax credit shall be granted to taxpayers for investment projects
- valued at 50 million forints or more at current prices, implemented by small enterprises,
- valued at 100 million forints or more at current prices, implemented by medium-sized enterprises;
- for investment projects valued at 100 million forints or more at current prices, implemented in a free enterprise zone.
Tax credit may be claimed on condition that the investment qualifies as an initial investment:
a) implemented by a small and medium-sized enterprise, or
b) realized by a large company in the Észak-Magyarország, Észak-Alföld, Dél-Alföld, Dél-Dunántúl, Közép-Dunántúl, Nyugat-Dunántúl or Pest planning and statistical district.
Ireland
Research and Development (R&D) Tax Credit / Capital Expenditure Tax Relief — a company can claim a 25% tax credit for expenditure on R&D carried on within the EEA. This can be combined with the normal business deduction for such R&D expenditure (at an effective rate of 12.5%), which results in a tax rate of 37.5%.
Income tax relief can also be made available to 'key R&D employees'. This means a company engaged in R&D activities can surrender some of its R&D credit to key employees so that their income tax liability is reduced by the amount surrendered (subject to not reducing the key employee's effective rate of tax to below 23%).
Write-down of Cost of Acquiring Intellectual Property — companies that acquire IP can deduct the cost of that acquisition against taxable profits. The deduction is available as a capital allowance (tax depreciation) and the cost is written-off over a number of years. The relief may be claimed when the IP is acquired from a third party and intra-group, subject to certain limitations. Further, the capital allowances claimed cannot exceed 80% of the company's taxable profit.
Knowledge Development Box — this is a form of patent box, and under the regime, profits derived from 'qualifying IP' will be subject to an effective rate of corporation tax of 6.25% (subject to certain requirements being met).
Italy
Bonus for investments in R&D activities, technological innovations, and patent box.
For R&D activities a tax credit amount of 20% of the eligible expenses, up to a maximum of EUR 4 million.
For technological innovation activities, the tax credit is recognised separately at a 10% rate of the relevant basis of calculation, up to a maximum of EUR 2 million. For the achievement of an ecological transition or digital innovation 4.0 objective, the credit measure increases to 15%.
These tax credits are non-taxable tout court.
Patent box relief consists in the possibility of increasing by 110% the deduction of costs incurred in relation to the eligible intangible assets.
Netherlands
R&D deductions, innovation activities, tax/patent box.
Under the Dutch innovation box regime, qualifying income from research and development activities are taxed at an effective rate of 9% rather than the statutory corporate income tax rate of ~ 25%.
Poland
Research & Development (R&D) tax relief that can decrease a company's tax bill by an additional deduction of eligible R&D expenses from a company's tax base. The additional deduction amounts to:
(i) 100% of eligible expenses - for all companies;
(ii) 150% of eligible expenses - for companies simultaneously having the status of R&D Centre and the status of a micro entrepreneur, small entrepreneur, or medium-sized entrepreneur;
(iii) 100% of eligible expenses for obtaining and maintaining a patent, a utility model protection right, an industrial design registration right defined by a bill and 150% of the rest eligible expenses- for other companies which have the status of an R&D Centre.
The Polish Investment Zone is an incentive that provides an exemption from CIT for companies which carry out certain new investments. The value of incentive (the amount of tax that is subject to exemption) is a derivative of the amount of investment costs incurred by the company.
Portugal
Possibility of a Research & Development (R&D) tax credit (SIFIDE) - tax incentive applicable to corporate taxpayers that consists of a tax deduction to companies’ tax burden of a certain amount of expenses incurred in the current year, with the possibility of a deferral up to 8 following tax years. This benefit allows a tax deduction of up to 82.5% for companies that have not invested in R&D in the last two years. This incentive is subject to pre-approval from the competent Portuguese authority.
There is also a Special Tax Regime to Support Investment (RFAI) - tax incentive applicable to corporate taxpayers who satisfy certain requirements and who develop a specific activity foreseen in the Portuguese tax law, which entitles to tax benefits (such as deductions, exemptions, or reductions) at the level of Corporate Income Tax, Municipal Property Tax, Property Transfer Tax as well as Stamp Duty.
Singapore
No Corporate Income Tax Rebate for year of assessment (YA) 2022.
Tax Exemption Scheme for New Start-Up Companies: from YA 2020 onwards, new qualifying companies (where any YA of the first three YAs falls in or after YA 2020) will be given a 75% tax exemption on the first $100,000 of normal chargeable income and a further 50% tax exemption on the next $100,000 of normal chargeable income for each of the first three consecutive years of assessment.
Partial Tax Exemption for Companies: from YA 2020 onwards, qualifying companies will be eligible for partial tax exemptions to a maximum of $102,500 per YA.
Tax Deductions for Research & Development ("R&D") Expenditure: subject to eligibility, enhanced tax deduction of 250% for R&D done in Singapore and tax deduction of 100% for R&D carried out overseas from YA 2019 to YA 2025.
Capital Allowances for Acquisition of IP Rights: companies can claim writing-down allowances on capital expenditure incurred up to the last day of the basis period for YA 2025 to acquire approved intellectual property rights for use in their trade or business. "Capital expenditure" excludes legal fees, registration fees, stamp duly and other costs related to the acquisition of the intellectual property rights.
Slovakia
Certain advantages can be provided in the form of investment incentives (eg to start new production or the provision of services); these incentives are subject to the special regulation in the State Aid Act and can be provided in the form of cash or tax relief. Certain corporate income tax relief can be also provided under the Act on Investment Incentives and the Act on Research and Development Incentives.
Patent Box – this new form of tax advantage was introduced as of January 2018. Under this special tax regime, it will be possible to be exempt from income tax up to 50% of any revenues derived in the form of license fees relating to the provision of intangible assets resulting from the taxpayer’s own development activities in Slovakia (patents, utility models, or software). The tax exemption however, only applies to taxable periods in which the taxpayer depreciates the capitalised costs relating to the development of these intangible assets (eg inventions protected by patent, the technical solutions protected by utility model or the software). In addition, a separate tax regime was introduced for revenues derived from the sale of products manufactured on the basis of an invention protected by patent or a technical solution protected by utility model – such revenues will also be exempt from the income tax.
Spain
Corporate Income Tax (CIT).
- Research & Development (R&D) tax relief.
A CIT credit is available for companies incurring qualifying expenditure on R&D projects.
The deduction rate ranges from 8% to 42%.
- Patent Box tax relief.
A CIT relief of taxable base can be applied to income from the exploitation of certain intangible assets such as patents.
The reduction rate is 60%.
-Tax benefits Start-ups.
They can apply the reduced CIT rate (15%) during the first tax period in which they have positive taxable income and the following three tax periods.
They are exempt from the obligation to make payments in instalments during the two tax periods following the first one in which they obtain positive taxable income.
Possibility of requesting deferral of tax debts during the two tax periods following the first one in which a positive tax base is obtained, for 12 months (for the first period) and 6 months (for the second period), with waiver of guarantees and without accrual of interests on arrears. However, the self-assessment must be submitted within the voluntary filing period, and the taxpayer must be up to date with his tax obligations on the date of the application.
Personal Income Tax (PIT).
- Tax benefits Start-ups.
Improvement of the deduction for investment in new or recently created companies by increasing the deduction rate from 30% to 50%, as well as the base of the deduction from €60,000 to €100,000, the base being formed by the acquisition value of the shares or holdings subscribed in these entities. This deduction will only be applicable if the shares or holdings were acquired at the time of incorporation or in a capital increase within 5 years of incorporation (7 years for companies in special sectors such as biotechnology, energy and strategic sectors).
United Arab Emirates
No special tax regime or tax benefits.