The innovation tax credit, explained.

Who is eligible?

The scheme targets SMEs under the EU definition, taxed under an actual-profit regime, and certain exempt businesses. Linked and partner enterprises also count when assessing company size.

Which projects may qualify?

Designing prototypes or pilot installations for a new tangible or intangible product. It must outperform products already available on the market in technology, functionality, ergonomics or eco-design.

An application or connected device may qualify. A visual redesign, maintenance or routine development alone does not establish eligibility. Production and commercialisation are excluded.

How much could you claim?

In mainland France, excluding Corsica: 20% of eligible expenditure capped at €400,000 per year, for a maximum tax credit of €80,000. Public grants allocated to the operations must be deducted. Specific rates apply in Corsica and overseas departments.

Example: €50,000 of qualifying expenditure after deducting grants yields a €10,000 tax credit. This is an illustration, not an invoice discount or a guaranteed refund.

How do you prepare your claim?

1. Define the product and compare its performance with the market.
2. Identify the work, expenditure and evidence to retain.
3. For outsourced work, check the supplier’s CII approval and its validity for the relevant period. Approval does not automatically make every project eligible.
4. Have your accountant or tax adviser validate the qualifying expenditure and tax return. A tax ruling can provide certainty from the tax authorities.

How can Kasual help?

We discuss your product, its uses and the work involved. Eligible services must be identified within the project scope; the tax assessment depends on your situation and the scheme’s criteria.