The allowable tax deduction is limited to 50% of the taxable income of the individual / person in the year in which the investment is made and may not exceed the amount of €150.000 per year. Any excess investments can be carried forward and claimed as tax deductible in the following 5 years.
According to the amendment, the legal person (that is an independent investor) can deduct 30% of the amount invested in the innovative SMEs and it is applied only for equity investments.
Other key amendments amongst others are:
Existing enterprises with financial history:
Such enterprises should submit a certificate in accordance with audited financial statements, issued by a certified auditor, certifying that the expenses for research and development in at least one of the three previous tax years, represent at least 10% of their total operational expenses / operating cost
Enterprises in the start-up phase, with no financial history:
These enterprises should submit a business plan to demonstrate their ability to develop new or substantially improved products, services, or procedures with high technological or industrial risk that are defined as innovative in their respective sector.
Enterprises that obtain certificate without assessment:
The enterprise should fulfil at least one of the following criteria during the last 3 years:
• The enterprise should have secured funding from one of the SME Instrument Phase I or Phase II, EIC Pathfinder and EIC and EIC Accelerator programmes of the EU Horizon 2020 Funding Programme, or from one of the EIC Pathfinder and EIC Accelerator programmes of the Funding of the EU Horizontal Europe 2021-27 Funding Programme.
• The enterprise should have received a Seal of Excellence with respect to the programmes mentioned above.
• The enterprise should have secured funding from the Innovation programmes PRE-SEED, SEED or INNOVATE or from other corresponding Innovation Programmes to be announced within the framework of the National Framework Programmes for Research and Innovation of the Research and Innovation Foundation
• The enterprise should have secured a Startup Visa.