Retroactive Application – Why Now Is the Best Time
The Research Allowance Act (FZulG) has been in effect since January 1, 2020. All fiscal years since 2020 are generally eligible – provided the tax assessment for the respective year is still open or amendable. Are you potentially entitled to a substantial funding amount?
A large proportion of eligible companies have not yet used the Research Allowance. The reasons: lack of awareness, uncertainty about eligibility, insufficient capacity. The result: billions in funding remain unused.
Why is right now the best time for retroactive application? Three factors speak for it:
Statute of Limitations Risk for 2020
The assessment period for fiscal year 2020 is about to expire in many cases. Those who do not act now will permanently lose their claim.
Cumulative Effect
Applying for multiple years at once can yield a six-figure or even seven-figure funding amount in one go – a unique opportunity.
SME Bonus from 2024
The increased 35% funding rate for SMEs applies from fiscal year 2024 through the Growth Opportunities Act. You can directly benefit from this.
Overview: Which Fiscal Years Are Still Open?
The following table provides an overview of the funding conditions for each fiscal year since the FZulG came into force. The urgency assessment is based on typical assessment periods – the actual situation depends on the individual tax assessment.
| Fiscal Year | Status | Funding Rate | Max. Assessment Basis | Action Required |
|---|---|---|---|---|
| 2020 | Usually still possible | 25% | 4M EUR | Urgent! Expiry imminent |
| 2021 | Offen | 25% | 4M EUR | Apply soon |
| 2022 | Offen | 25% | 4M EUR | Gute Chancen |
| 2023 | Offen | 25% | 4M EUR | Gute Chancen |
| 2024 | Offen | 25% / 35% KMU | 12M EUR | Optimal |
| 2025 | Offen | 25% / 35% KMU | 12M EUR | Optimal |
Requirements for the Retroactive Application
For a retroactive Research Allowance to be successfully claimed, several requirements must be met simultaneously. The good news: most requirements can also be fulfilled or documented retroactively. Here are the five key requirements in detail:
R&D Projects in the Respective Fiscal Year
Actual R&D activities according to the Frascati Manual: basic research, applied research, or experimental development. The key criterion is overcoming a technical uncertainty.
Tax Assessment Still Open or Amendable
The tax assessment must still be open – subject to review, objection filed, or assessment period not yet expired. Your tax advisor can check the status.
Personnel Costs Verifiable
Gross wages and salaries of R&D employees from payroll records, employment contracts, and salary statements – available in most companies even for past years.
R&D Character Documentable
Documentation via a BSFZ application with project description and scientific-technical objectives. Can also be submitted retroactively – no application needed during the research period.
Separate BSFZ Application for Each Year
A separate BSFZ application required for each fiscal year. A multi-year project can be described as a continuous project.
1. R&D projects carried out in the respective fiscal year
2. Tax assessment still open (subject to review or assessment period)
3. Personnel costs verifiable from payroll accounting
4. R&D character documentable retroactively (BSFZ application)
5. Separate BSFZ applications for each fiscal year
The Biggest Challenge: Documenting R&D Retroactively
By far the biggest challenge with retroactive applications is the retrospective documentation of R&D activities. Many companies have carried out excellent R&D work in recent years but have not maintained separate R&D time tracking or formal project documentation as required by the FZulG.
The good news: a complete reconstruction is possible in the vast majority of cases. R&D activities leave numerous traces within the company that can be compiled retroactively into audit-proof documentation.
Sources for Retrospective Reconstruction
The following documents and data sources are excellent for retroactively documenting R&D activities:
NOVARIS Consulting has extensive experience with retrospective reconstruction of R&D documentation. Our consultants work closely with your technical departments to review, structure, and convert existing documents into audit-proof documentation meeting BSFZ and tax office requirements.
Calculation Example: How Much Funding You Can Claim
To illustrate the potential of retroactive application, consider a realistic example. Take an SME with 8 R&D employees and an average gross salary of EUR 75,000 per year. The company has continuously conducted R&D since 2020 but never applied for the Research Allowance.
| Wirtschaftsjahr | Bemessungsgrundlage | Fördersatz | Forschungszulage |
|---|---|---|---|
| 2020 | 600.000 EUR | 25% | 150.000 EUR |
| 2021 | 600.000 EUR | 25% | 150.000 EUR |
| 2022 | 600.000 EUR | 25% | 150.000 EUR |
| 2023 | 600.000 EUR | 25% | 150.000 EUR |
| 2024 | 720.000 EUR | 35% (KMU) | 252.000 EUR |
| 2025 | 720.000 EUR | 35% (KMU) | 252.000 EUR |
| Total | 1.104.000 EUR |
Explanation: The assessment basis for 2020–2023 is 8 employees x EUR 75,000 = EUR 600,000 (pure personnel costs). From 2024, the 20% overhead surcharge is added: EUR 600,000 + EUR 120,000 = EUR 720,000. The funding rate for 2020–2023 is uniformly 25%; from 2024, the SME rate of 35% applies.
70% of external R&D remuneration is eligible. At EUR 200,000/year to research partners: +EUR 140,000 assessment basis. Learn more
Shareholders & sole proprietors: EUR 100/hour (max. 40h/week). Ideal for owner-managed companies with active R&D involvement.
How the Retroactive Application Works with NOVARIS
The retroactive Research Allowance application is a structured process that NOVARIS Consulting guides from initial analysis to payout. Our proven process ensures no funding is left behind and documentation is audit-proof.
Free potential assessment: open years, eligible projects, expected allowance.
Project reconstruction with your departments, audit-proof project descriptions.
Separate applications per fiscal year to the certification body.
Submit Annex FZ with assessment basis and requested allowance.
Offset against tax liability or direct refund.
FAQ: Retroactive Research Allowance
The Research Allowance is assessed as part of the income or corporate tax assessment. The standard assessment period is 4 years starting at the end of the calendar year in which the tax return was filed. Example: If the 2020 tax return was filed in 2022, the deadline expires at the end of 2026. In cases of negligent tax reduction, the period extends to 5 years; for tax evasion, to 10 years. As long as the tax assessment is subject to review, the Research Allowance can be applied for retroactively at any time.
Yes, absolutely. Each fiscal year is evaluated separately. You can register different R&D projects with the BSFZ for each year. This is actually the norm: companies evolve their research portfolios over time. A separate BSFZ application is filed for each fiscal year. A multi-year project can be described as a continuous project.
No, Annex FZ (Research Allowance) can be submitted subsequently without amending the original tax return. The Research Allowance is assessed as a separate decision and offset against tax liability – or directly refunded. Your tax advisor only needs to submit Annex FZ. NOVARIS prepares it and coordinates with your tax advisor.
NOVARIS works on a success-based model. You only pay if the Research Allowance is actually granted. The initial analysis is always free and non-binding. No risk for you: if no allowance is granted, no costs are incurred.
No, the increased SME funding rate of 35% was only introduced with the Growth Opportunities Act and applies from fiscal year 2024. For 2020–2023, the uniform 25% rate applies regardless of company size. From 2024, SMEs benefit from the higher rate. The increased assessment basis of EUR 12 million (previously EUR 4 million) benefits all company sizes.
