On 29 December 2022, the Finnish Ministry of Finance has announced the approval of legislation regarding new tax support for research and development activities (R&D). The new incentive is combined deduction of a general additional deduction based on the amount of R&D expenses and an added additional deduction based on the increase in R&D expenses compared to the previous year.
The amount of the general additional deduction is 50% of the expenses that are calculated as the basis for the additional deduction. The maximum amount for the general additional deduction in a tax year is 500,000 EUR and the minimum amount is 5,000 EUR. The amount of added additional deduction is 45% that are calculated as the basis of actual increased amount of R&D salary and purchase service expenses. The maximum amount for the added additional deduction in the tax year is also 500,000 EUR but there is no lower limit.
The general additional deduction can be obtained for the first time in the taxation submitted for the tax year 2023 and the added additional deduction can be used in taxation from 2024 onwards.
