tax credit for research and scholarships

The 2015 Italian Financial Act (Legge di Stabilità) introduces the research and development bonus that replaces the tax credit for investments in research and development provided by the Destinazione Italia decree (art. 3, 145/2013).

 

At this time, a similar norm (art. L. 190/14, paragraphs 1, 35 and 36, replacing art. 3 of DL 145/2013 law 9/2014) is active. It foresees that that all companies (independently from their legal form, from the financial sector in which they operate, and their accounting regime) investing in research and development activities, from 2015 to 2019, have access to a tax credit of 25% of the surplus costs, compared to the average of the same investments made in the three tax periods preceding 2015.

 

In order of determining the tax credit, expenditure on research contracts with universities, research organisations, and similar institutions (as well as with other enterprises including innovative start-ups - art. 25 of Legislative Decree 179/2012) is eligible. For the costs of research contracts with universities, tax credit is 50% of the expense.

 

According to art. 1 co. 285-287 of Law 228/12, a tax credit is allocated to subjects granting scholarships to university students (as referred to in art. 1, paragraph 1, letter b) of the Legislative Decree of 29 March 2012, n. 68), within the limits and with the procedures provided in paragraphs 286 and 287; for the operating rules, see art. 3, paragraph 1, D.P.C.M. 20 February 2014.

 

 

 

According to art. 1 co. 353 of L. 266/05, the contributing subject can entirely deduct the research funds from its income, as contribution or donation, from corporations and other taxable persons of corporate income tax (IRES) in favour of universities and university foundations.

 

Following is a list of other norms that allow Ires deduction, even without specific research purpose:

– 1. art. 100 co. 2 lett. a) of dpr 917/86: allowances made to legal persons purely for purposes other than those referred to in paragraph 1 (including education) or for scientific research purposes; deductibility is limited to 2% of total income

 

– art. 100 co. 2 lett. o-bis) of dpr 917/86: allowances made to schools of all orders (as long as they are non-profit state schools or organisations belonging to the national education system, as per law no. 62 and subsequent modifications), focusing on technological innovation, school building, and expansion of the educational offer (within the limit of 2% of business income, and up to a max of €70.000 per year); the deduction is possible, provided that the payment is made through a bank or post office (payment systems provided for in art. 23 of Legislative Decree no. 241, 9 July 1997)

 

– for actual persons, the reference norms are constituted by art. 10 (lett. l-quater) and art. 15 (lett. i-octies) of Dpr 917/86; deductibility is not conditioned by research purposes.