Example of a leading automotive company
Background
France currently boasts the most advantageous tax system for R&D among OECD member states, namely its research tax credit (CIR). In 2015, more than 16,000 companies declared eligible expenditures, thus benefitting from around 5.3 billion euros in CIR. This measure supports domestic R&D efforts and has a positive impact on the attractiveness of the French economy.
To secure declared tax credits, companies must gather increasingly convincing documentation to satisfy auditors’ requirements. For a group of related companies, there is also the issue of data volume and the number and diversity of contact people. Establishing a specific approach for calculating and documenting the CIR is now essential.
Challenges
Hand-in-hand with the client, Wavestone helped address three major challenges:
- Providing scientific and technical expertise concerning the Group’s R&D activities;
- Identifying all research and development expenditures eligible for the CIR and securing the declared amounts;
- Monitoring changes in taxation and case law to anticipate strategic decisions concerning the expenditures declared as eligible for the CIR.
Responses & Key Success Factors
By mobilizing the Wavestone team, the company received support in:
- Establishing a robust, controlled process for identifying activities eligible for the CIR based on a dense network of contacts and specific tools;
- Developing financial deliverables ensuring the traceability and accuracy of the calculations of R&D expenditures eligible for the CIR;
- Preparing technical reports meeting the Ministry of Research’s requirements through ongoing training and technical support for the internal teams.
