R&D Tax Credit 2026:
What's Changing – and How You Benefit

The changes took effect in stages: The 35% SME bonus and the increased assessment basis of EUR 12M have been in effect since the Growth Opportunities Act (2024). The 20% overhead surcharge was introduced in 2025. From 2026, all changes are fully effective and can also be applied for retroactively.

Yes, provided the tax assessment for the year in question is not yet final. The increased funding rate of 35% for SMEs applies retroactively from fiscal year 2024. For fiscal years 2020-2023, the regular rate of 25% continues to apply. Important: Even at 25%, retroactive application is well worthwhile.

SMEs are defined as companies that at the time of application employ fewer than 250 employees and have either annual revenue of no more than EUR 50M or an annual balance sheet total of no more than EUR 43M. The definition follows EU Recommendation 2003/361/EC. Affiliated and partner companies are taken into account.

The 20% overhead surcharge is applied as a flat rate to eligible personnel costs. Example: With EUR 500,000 in eligible personnel costs, the assessment basis increases by EUR 100,000 to a total of EUR 600,000. The surcharge does not need to be individually documented – it is a flat rate that is automatically recognized.

No, the increased funding rate of 35% is exclusively reserved for small and medium-sized enterprises (SMEs). Large enterprises continue to receive the regular funding rate of 25%. However, large enterprises also benefit significantly from the increased assessment basis (EUR 12M instead of EUR 4M) and the overhead surcharge (20%) – as our calculation example above shows.

From 2026, all improvements introduced since 2020 take effect simultaneously for the first time: The assessment basis is EUR 12 million, SMEs receive a 35% funding rate (instead of 25%), material costs are eligible, the 20% overhead flat rate is applied to personnel costs and contract research is recognized at 70%. What is new from 2026 is above all the cumulative effect: An SME can receive up to EUR 4.2 million in R&D Tax Credit per year for the first time. Additionally, retroactive claims for fiscal years 2020–2025 can be filed, provided the tax assessment statute of limitations has not yet expired.

For SMEs, the maximum R&D Tax Credit in 2026 amounts to up to EUR 4.2 million per fiscal year. The calculation: A 20% overhead flat rate is added to eligible personnel and material costs. The resulting assessment basis is capped at EUR 12 million. The SME funding rate of 35% is then applied – yielding a maximum of EUR 4.2 million. A specific example: An SME with EUR 2 million in R&D personnel costs receives an assessment basis of EUR 2.4 million (including 20% overheads) and thus an R&D Tax Credit of EUR 840,000 (35% of EUR 2.4 million). That is 68% more than with the previous funding rate of 25% without the overhead flat rate.