Why BSFZ Applications Get Rejected
If you have received a rejection notice from the Certification Body for Research Allowance (BSFZ), you are not alone. Approximately 25-30% of all initial applications are partially or fully rejected. This means a significant proportion of companies that are entitled to the research allowance initially fail in the BSFZ process.
The reasons are varied, but in most cases the problem is not that no R&D is taking place. Rather, the R&D character of the projects is not sufficiently demonstrated in the application. The BSFZ evaluates applications based on strict criteria derived from the OECD Frascati Manual. Anyone who does not precisely address these criteria risks rejection — regardless of how innovative the project actually is.
The most common reason for rejections is the unclear distinction between R&D activities and routine activities. Many companies describe their projects from a business perspective. However, the BSFZ is exclusively interested in the technical-scientific dimension: What technical uncertainties existed? What new knowledge was generated? What systematic approach was applied?
This discrepancy between what companies intuitively describe and what the BSFZ must evaluate is the main cause of avoidable rejections. With the right presentation, this can be corrected in an appeal or improved reapplication.
The 6 Most Common Reasons for BSFZ Rejection
To formulate a successful appeal, you first need to understand why your application was rejected. Here are the six most common rejection reasons we see in our consulting practice:
No recognizable technical novelty
This is the most common rejection reason. The BSFZ classifies the project as an application of already known methods or technologies.
How to fix this in the appeal: Describe precisely how your solution differs from the state of the art. Conduct explicit prior art research and identify the gap your project fills.
Missing systematic approach
The BSFZ requires evidence of systematic, planned R&D work using scientific methodology including hypothesis formation, experiments, analysis, and documentation.
How to fix this in the appeal: Present your development process as a structured research plan. Describe specific work packages, milestones, test series, and documentation methods.
No technical uncertainty
R&D requires that the outcome was not foreseeable. This reason occurs particularly with software projects and process optimizations.
How to fix this in the appeal: Describe specifically what technical challenges existed and which approaches did not work. Document failed attempts and unexpected results.
Insufficient project description
Too vague, too short, no concrete details – many rejections result from inadequate descriptions. When details are missing, rejection follows.
How to fix this in the appeal: Expand the project description significantly. Specify concrete technical parameters, materials, algorithms, and measurement results. 3-5 pages per project is typical.
Wrong R&D category selected
The FZulG distinguishes between basic research, industrial research, and experimental development. Wrong classification leads to wrong evaluation criteria.
How to fix this in the appeal: Überprüfen Sie die Zuordnung anhand der offiziellen Definitionen. Die meisten Projekte fallen unter „experimentelle Entwicklung".
Routine activity instead of R&D
QA, standard tests, market research, or product maintenance are not R&D per BSFZ criteria. This error occurs with broad R&D definitions.
How to fix this in the appeal: Clearly distinguish R&D from routine work. Focus on components with technical novelty and uncertainty. Less is often more.
What Can You Do After a BSFZ Rejection?
After receiving a rejection notice, you have three fundamental options. Which option is right depends on your individual situation — particularly the deadline status, type of rejection, and available evidence.
Option 1: Formal Appeal (within one month)
The formal appeal is the most direct and effective measure against a BSFZ rejection. The deadline is one month from receipt of the rejection notice. Within this period, you can file a written appeal and submit an improved justification.
The appeal should contain the following elements:
- A written justification that specifically addresses the rejection reasons stated in the notice
- A revised and more detailed project description
- Additional evidence of the technical novelty and R&D character of the project
- If applicable, a supplementary technical statement
Important: An appeal can also relate to partial rejections. Wenn beispielsweise nur drei von fünf eingereichten Projekten abgelehnt wurden, können Sie gezielt gegen die Ablehnung dieser drei Projekte vorgehen.
Option 2: Improved Reapplication
If the appeal deadline has already passed or if you want to fundamentally revise the application, you can submit an improved reapplication. This is also advisable when you want to apply for other or new fiscal years.
A reapplication offers the advantage that you can completely rebuild the application from scratch – mit den Erfahrungen aus der ersten Ablehnung. Mit professioneller Unterstützung sind die Erfolgsaussichten bei einem verbesserten Neuantrag deutlich höher als beim ursprünglichen Erstantrag, da die typischen Fallstricke bereits bekannt sind.
Option 3: Lawsuit Before the Tax Court
As a last resort, you can take legal action through the tax court. However, this option is rarely necessary and is only recommended for fundamental disputes, bei denen eine prinzipielle Klärung angestrebt wird. In der Praxis werden die meisten Fälle bereits im Widerspruchsverfahren erfolgreich gelöst.
Before pursuing litigation, you should seek legal advice und die Kosten-Nutzen-Relation sorgfältig abwägen. Der Widerspruch ist in den allermeisten Fällen der effizientere und kostengünstigere Weg.
Your Options at a Glance
Guide: Successful Appeal in 5 Steps
A successful appeal against a BSFZ rejection follows a structured process. Here are the five decisive steps that maximize your chances of success:
Analyze the rejection notice
Read the rejection notice carefully and identify the exact reasons for rejection. Mark the key statements and categorize them. Pay special attention to phrases like „nicht erkennbar", „nicht nachgewiesen" oder „unzureichend dargelegt" – diese zeigen Ihnen, wo die Argumentation verstärkt werden muss.
Revise the project description
Revise your project description specifically based on identified weaknesses. Add details that emphasize the R&D character. Use the terminology of the Frascati Manual and address the five criteria: novelty, uncertainty, systematic approach, transferability, and reproducibility.
Gather additional evidence
Support the R&D character of your project with concrete evidence: patent searches, scientific publications, test series protocols, prototype documentation, measurement results, correspondence with research institutions, and state-of-the-art comparisons.
Draft a technical statement
Draft a structured technical statement that addresses the rejection reasons point by point. Follow this structure: (a) Quote the rejection reason, (b) Technical counter-argument with evidence, (c) Conclusion why R&D is present.
Submit on time
Submit the appeal within the one-month deadline. Plan 1-2 weeks lead time. If time is short, first submit an informal appeal to preserve the deadline and provide the detailed justification later.
Why Professional Support Doubles the Success Rate
Experience shows that appeals with professional support have a significantly higher success rate than self-attempts. While companies that appeal without consulting achieve a success rate of approximately 35-45%, the rate with professional guidance is 70-80%.
There are several reasons: NOVARIS Consulting knows the BSFZ internal evaluation criteria and what assessors look for. Our experts have experience with hundreds of applications and appeals across various industries and technology fields. We master the technical writing style that convinces BSFZ assessors — a mix of scientific precision and clear presentation.
What NOVARIS Does for You
- Free initial analysis: We evaluate your rejection notice and realistically assess the chances of a successful appeal
- Professional revision: We prepare the complete appeal justification including technical statement
- Evidence preparation: We help you identify and prepare the right documentation
- BSFZ communication: We handle the timely submission and any follow-up questions
- Process support: We accompany you to the final decision and prepare the tax office application if needed
Success-based: No Risk for You
NOVARIS works on a success-based model. Specifically: Only when your appeal is successful and you receive the BSFZ certification does a fee apply. If the appeal is unsuccessful, you pay nothing. The initial analysis of your rejection notice is always free and non-binding.
This model ensures we only take on cases where we see realistic chances of success. For you, this means: maximum transparency and zero financial risk. The research allowance you receive through a successful appeal typically exceeds our fee many times over.
Success Rate Comparison
Success rate for BSFZ appeals based on consulting practice and industry data.
Frequently Asked Questions About BSFZ Rejection
You have one month from receipt of the rejection notice to formally file an appeal. This deadline is legally mandated and strictly enforced. We recommend seeking professional support immediately after receiving the notice. In emergencies, you can first submit an informal appeal to preserve the deadline and provide the detailed justification later.
At NOVARIS Consulting, we work on a success-based model. Only when your appeal is successful and you receive the research allowance does a fee apply. You take on no financial risk. The initial analysis of your rejection notice is always free and non-binding. The appeal process at the BSFZ itself is fee-free.
Yes, a partial appeal is always possible and often advisable. If only certain projects from your application were rejected, you can specifically challenge those individual rejections. Already approved projects remain completely unaffected. This is particularly relevant when you submitted multiple projects in one application and only some did not meet the criteria.
With professional support, the success rate for appeals against BSFZ rejections is approximately 70-80%. What matters is well-founded technical argumentation that specifically addresses the rejection reasons and clearly demonstrates the R&D character. Without professional help, the rate is significantly lower, as the specific BSFZ requirements are often insufficiently addressed.
During the appeal process, your application remains open. There are no negative effects on future applications or your relationship with the BSFZ. The certification body reviews your appeal again — typically by a different assessor — and can overturn, partially modify, or confirm the original decision. Processing time is typically 4-8 weeks. During this time, you can already submit new applications for other fiscal years.
