France: R&D relief to be refunded


In contrast to New Zealand (see this post), France has announced that in 2009 it will refund all outstanding R&D relief which has not yet been used to reduce corporation tax – broadly, where the relief has been claimed by a loss-making company.   Normally, a loss-making French company claiming R&D tax relief would need to wait three years before obtaining repayment.  The move is part of a French proposed economic recovery plan.

The French R&D relief provides a credit of around 30% to 50% of the R&D expense incurred.  The relief is given by deduction from corporate income tax owed by the company; repayment was previously only available where the relief could not be set against corporate income tax within three years of the relief arising.

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