The Government has introduced a refundable tax credit for research and development activities. This new 10% tax credit for eligible R&D expenses provides a greater benefit than the previous 8%, which could be obtained by applying an additional 50% deduction of eligible expenses when calculating corporate income tax. The credit represents an alternative option to the additional deduction already provided for in the Fiscal Code.
The credit is deducted directly from the tax due, and any unused amounts become tax receivables, which can be offset or refunded over a period of up to four fiscal years. This is an important change that can encourage both large multinational groups and major local companies to continue R&D projects in Romania. Moreover, being aligned with Pillar Two rules, the refundable tax credit allows companies subject to the global minimum tax to benefit from R&D incentives without the risk of neutralizing their fiscal impact.
To facilitate access to these benefits, KPMG experts recommend a “quick scan” analysis, which rapidly assesses eligibility for R&D tax incentives and provides greater predictability. Collaboration with multidisciplinary teams—tax, technical, financial, and HR—can transform R&D incentives from an unknown into a strategic advantage, emphasizes Cristina Spirescu, Associate Director within the Tax Department, KPMG in Romania.
