The paperwork for a key research and development (R&D) incentive is too complicated for small and medium-sized businesses, the government has been told.

Last month, the umbrella group of accounting bodies CCAB-I conducted a survey of members working in firms and in industry with professional experience requesting the R&D tax credit.

“One of the main findings of our survey is the call for simplified documentary requirements for SMEs as part of a wider simplification of the SME regime. In particular, CCAB-I is of the opinion that the requirements set by Revenue both in terms of scientific merit and documentation are not appropriate for SMEs.

The submission followed the public consultation on the research and development tax credit and the knowledge development box.

He said simplifying documentation requirements for SMEs is consistently cited by accountants as a barrier to claiming the R&D tax credit.

“Unlike many large corporations, SMEs and startups in particular often lack the financial resources to engage professional counsel to prepare the appropriate documentation stipulated by Revenue.”

The incentive is also important for global companies based here.

“Foreign direct investment (FDI) is a key driver of growth in Ireland and the R&D tax credit is a key tool in attracting investment from global capital,” CCAB-I said in its submission to the Department for Finance.

New US tax rules mean changes are needed to keep the Irish R&D tax credit competitive, the document says.

“As a result of these changes, US investors are demanding that the Irish R&D tax credit be fully refundable. While such a change would result in a cash flow adjustment for the Exchequer, it should not result in any additional cost to the Exchequer.

“Professional accountants have advised that if the current refundable credit repayment rules remain in place, from 2022 US investors may not look to Ireland in the first place. This would have a negative impact on the economy. Irish.