Overview
SIFIDE II enables companies to deduct eligible R&D expenditure from their Corporate Income Tax (CIT / IRC) liability, up to its full amount, corresponding to expenses incurred during the relevant tax period.
Beneficiaries
Eligible beneficiaries include CIT taxpayers resident in Portuguese territory whose principal activity is agricultural, industrial, commercial or services-related, as well as non-resident entities with a permanent establishment in Portugal, provided that they cumulatively meet the following conditions:
− Their taxable profit is not determined using indirect assessment methods;
− They have no outstanding debts to the State or to Social Security, or such debts are duly secured.
Applicable Legislation
Eligible Expenditure
- Acquisition of tangible fixed assets, excluding buildings and land, provided they are created or acquired as new and proportionally allocated to R&D activities;
− Personnel expenses related to staff holding a minimum National Qualifications Framework (NQF) level 4, directly involved in R&D activities;
− Expenses related to the participation of directors and senior staff in the management of R&D institutions;
− Operating expenses, up to a maximum of 55% of eligible personnel costs, relating to staff with at least NQF level 4 qualifications directly involved in R&D activities;
− Expenses related to the outsourcing of R&D activities to public entities, entities with public utility status, or entities whose R&D credentials are officially recognised;
− Equity participation in R&D institutions and contributions to public or private investment funds dedicated to financing companies primarily engaged in R&D, including the valorisation of R&D results, provided their R&D credentials are recognised by ANI, S.A.;
− Patent registration and maintenance costs;
− Expenses related to the acquisition of patents predominantly intended for R&D activities;
− R&D audit expenses;
− Expenses related to demonstration actions arising from supported R&D projects.
Personnel expenses related to staff holding NQF level 8 qualifications are eligible at 120% of their actual value.
Expenses related to R&D activities associated with eco-design projects are also eligible at 120%.
Eligible Actions
Eligible operations must include Industrial Research and/or Development
Experimental aimed at:
− Creating new innovative products, processes or services;
− Introducing significant improvements to existing products, processes or services;
− Developing technological solutions aligned with national and regional RIS3 priorities.
Crédito Fiscal
The tax incentive takes the form of a deduction from the CIT liability, up to its full amount, corresponding to eligible R&D expenses incurred during the relevant tax period. The deduction is calculated through a two-tier mechanism:
− Base Rate: 32.5% of eligible R&D expenses incurred in the period;
− Incremental Rate: 50% of the increase in R&D expenses compared to the simple arithmetic average of the two previous tax years, capped at €1,500,000.
For SMEs subject to CIT that have not yet completed two financial years and have not benefited from the Incremental Rate, a 15 percentage point uplift applies to the Base Rate, resulting in a total rate of 47.5%.
Any amount not deductible due to insufficient tax liability may be carried forward for up to twelve subsequent tax years following the year in which the R&D expenses were incurred.