On 17 July 2023, the Irish Revenue issued eBrief No. 166/23 on research and development (R&D) corporation tax credit. Accordingly, Tax and Duty Manual Part 29-02-03 – Research and Development (R&D) Corporation Tax Credit – has been updated to incorporate the changes to the R&D credit introduced by Finance Act 2022.
The Finance Act 2022 changes are reflected throughout the manual, with examples provided where appropriate. The manual is also updated:
- to remove obsolete material; and
- to include a new section 4.7 on costs associated with cloud computing.
Key changes introduced to Part 29 by Finance Act 2022 include:
- the introduction of sections 766C and 766D Taxes Consolidation Act 1997 (TCA 1997) providing for an R&D corporation tax credit
- the ability to accelerate (under sections 766(4D) and 766A(4C) TCA 1997) the payment of the second instalment and the final instalment of an R&D tax credit which arose in an accounting period that commenced pre-1 January 2022
Where a company is making a claim for an accelerated payment of the second and final instalment, and/or a claim for an R&D corporation tax credit under section 766C or section 766D in an accounting period for which a Form CT1 for 2022 is due to be filed, the company is required to file an R&D specified return 2022 which forms part of the Form CT1 2022. The updated manual provides guidance on how a claim should be made.
