You’re pretty sure your work qualifies for R&D tax credits, but you have no idea what actually happens between now and the money landing in your account. That gap, between knowing you're probably eligible and actually filing a compliant claim, is the most overwhelming and can put off genuine claimants.
Ireland's R&D tax credit is worth up to 35% of your qualifying expenditure, and the process for claiming it follows a fairly fixed sequence. This guide walks through that sequence from start to finish, with links to the detail on each stage along the way.
Step 1: Confirm your activity actually qualifies
Before anything else, check that the work you're claiming for meets Revenue's definition of qualifying R&D. In short, your project needs a genuine scientific or technological uncertainty, systematic work to resolve that uncertainty, and an advance that goes beyond what's already publicly known in your field, not just what your company happens to already know.
This test trips people up more often on the "advance" element than the other two. Plenty of technically demanding work is still just applying existing knowledge in a known way, and that doesn't qualify, however difficult it was to execute.
Step 2: Check whether you need a Pre-Filing Notification
If this is your first time claiming, or you haven't claimed in the last three accounting periods, you'll need to submit a Pre-Filing Notification (PFN) before you can file. The PFN has to reach Revenue at least 90 days before you submit your actual claim, and there's no flexibility on that deadline; Revenue doesn't grant extensions.
Work this out early. If you leave your PFN decision until close to your filing deadline, you may find you've already missed the 90-day window, losing your ability to claim for that accounting period altogether.
Step 3: Identify and apportion your qualifying costs
Once you know your project qualifies and any PFN requirement is handled, the next job is working out what you can actually claim for. The main categories are:
- Staff costs: salary, pension, bonus and other emoluments for employees working on qualifying R&D.
- Subcontractors: payments to third parties or universities carrying out R&D on your behalf, subject to a 15% cap.
- Consumable materials: raw materials, reagents and components used or destroyed during R&D.
- Software costs: licences, data costs and cloud computing used for R&D.
- Rent: only where the space is genuinely integral to the R&D itself, such as a lab or clean room.
- Overhead costs: a narrow set of costs, like power consumed directly during R&D processes.
- Capitalised costs: buildings, plant and machinery that also qualify for capital allowances, claimed on a different basis to day-to-day spending.
Across every category, the same principle applies: only the proportion of a cost that contributes to R&D counts. Revenue specifies that only costs incurred in “the carrying on of R&D” can be claimed, i.e., directly resulting in R&D (not supporting or related to). However you apportion that proportion, it needs to be on a basis you can explain and defend if Revenue asks.
Step 4: Build your technical report
Your technical report proves that you did qualifying R&D: what you were trying to achieve, what made it uncertain, and what you actually did to resolve that uncertainty. Revenue doesn't require you to submit this alongside your CT1, but it's part of the requirements of a compliant claim that you're able to produce it, and it's the first thing Revenue asks for if your claim is picked for an aspect query or audit.
Our guide on what makes a good technical report covers what to include in detail. The practical tip worth repeating here: write it while the work is still fresh. Reconstructing a year's worth of technical detail after the fact, especially once staff have moved on, is far harder than documenting it as you go.
Step 5: File your claim with your Corporation Tax return
You make your R&D tax credit claim through your CT1 Corporation Tax return. For accounting periods beginning on or after 1 January 2023, you must claim under sections 766C or 766D (the latter for capitalised R&D costs).
At filing, you'll also need to decide how you want to receive your credit. Ireland pays the R&D tax credit out over three annual instalments, either as a direct cash payment, a reduction against your Corporation Tax liability, or a mix of both.
Your claim has to be filed within 12 months of the end of the relevant accounting period; this is a crucial deadline you can’t miss.
Step 6: Keep records in case Revenue follows up
Once your claim is filed, keep the records that support it. Revenue can request more information about a claim or open a full audit, and claims can come under review for up to four years after the accounting period ends. This is a normal part of how a self-assessed scheme stays accountable. Companies whose records are already in order get through a review with the least disruption.
A quick checklist
- Qualifying check: confirm your project involves a genuine technological or scientific uncertainty and an advance beyond what's already known.
- PFN timing: first-time claimants and anyone with a three-period gap need to submit a Pre-Filing Notification at least 90 days before filing.
- Cost categories: staff, subcontractors, materials, software, rent, overheads and capitalised costs each have their own rules, and every cost needs a defensible apportionment.
- Technical report: build your narrative connecting uncertainty to resolution while the work is still fresh, even though you'll only need to hand it over if Revenue asks.
- CT1 filing: claims are made under sections 766C and/or 766D, within 12 months of the end of your accounting period.
- Payment mechanism: choose between cash payment and Corporation Tax offset, paid out across three annual instalments.
- Record-keeping: hold onto your supporting evidence, since Revenue can review claims for up to four years.
Getting your first claim right
Preparing an R&D tax credit claim in Ireland for the first time involves more steps than most founders expect, but each one is straightforward once you know where it sits in the sequence. Working through this process for the first time doesn't have to mean working through it alone. Get in touch and the Tax Cloud team can walk you through each step, or sign up to Tax Cloud to get started.
