Collaborative Research Tax Credit (CICo)

Your company might be eligible for a tax credit for its operations in France, owing to Macron’s new 2022 budget, which aims to improve France’s innovation capital.

Concluding a contract with a research and knowledge dissemination organisation (ORDC – Organismes de recherche et de diffusion des connaissances) will now be apply to apply for a tax credit which ranges from 40 to 50%, as defined by Article 244 of the French General Tax Code.

According to the French government an ORDC is defined as:

‘an entity (such as a university or research institute, a technology transfer agency, an innovation intermediary, a real or virtual research-based collaborative entity), regardless of its legal status (public or private) or the way in which it is funded, whose primary objective is to carry out independent basic research, industrial research or experimental development, or to disseminate widely the results of these activities by means of teaching, publications or knowledge transfer’, (Framework on State aid for R&D&I, 2014/C 198/01).

This tax credit would apply to the amount of R&D expenditure relative to the size of the company. This expenditure can include: equipment costs, staffing costs as well as operating expenses. As a side note these expenses must be invoiced by the ORDC.

The rate for SMEs is 50% of all eligible expenses (up to a limit of €6 million). For intermediate and larger sized companies, the rate is 40% of all eligible expenses (again up to a limit of €6 million).

A company who meets the following conditions in theory would be eligible for CICo:

Has signed a contract with an ORDC between 1st January 2022 to December 31st 2022
Is subject to French corporation tax
Their activities in France are either industrial, commercial or agricultural
The R&D involved must be original and innovative (i.e., new prototypes, experimental scientific research etcetera).

Approval for CICo will be granted by the minister responsible for research in government. The precise procedures for compiling a CICo application are set out in Decree 2022-1006 (published on the 15th July 2022).

If you would like more direct support regarding the steps that must be in order to begin an application for CICo please do get in touch. Maupard will be able to pinpoint all of the support/services that you might need in order to create a credible application.