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Science Policy PPS - Withholding tax R&D

Withholding tax R&D



Fundamental research:
means experimental or theoretical work undertaken primarily to acquire new knowledge of the underlying foundations of phenomena and observable facts, without any direct commercial application or use in view.

Industrial research:
means the planned research or critical investigation aimed at the acquisition of new knowledge and skills for developing new products, processes or services or for bringing about a significant improvement in existing products, processes or services. It comprises the creation of components parts of complex systems, and may include the construction of prototypes in a laboratory environment or in an environment with simulated interfaces to existing systems as well as of pilot lines, when necessary for the industrial research and notably for generic technology validation.

Experimental development:
means acquiring, combining, shaping and using existing scientific, technological, business and other relevant knowledge and skills with the aim of developing new or improved products, processes or services. This may also include, for example, activities aiming at the conceptual definition, planning and documentation of new products, processes or services. Experimental development may comprise prototyping, demonstrating, piloting, testing and validation of new or improved products, processes or services in environments representative of real life operating conditions where the primary objective is to make further technical improvements on products, processes or services that are not substantially set. This may include the development of a commercially usable prototype or pilot which is necessarily the final commercial product and which is too expensive to produce for it to be used only for demonstration and validation purposes. Experimental development does not include routine or periodic changes made to existing products, production lines, manufacturing processes, services and other operations in progress, even if those changes may represent improvements.

Fundamental research:

  • Place the project in the context of the company
  • What new scientific progress is (was) the project designed to make?
  • What sort of research activity will be (was) carried out to acquire this new knowledge?
  • What hypotheses, theories, laws will be tested (or have been formulated) through these research activities?

Industrial research:

  • Place the project in the context of the company.
  • What new knowledge and skills are (were) sought through the research?
  • What sort of R&D activities will be (were) carried out to acquire the new knowledge and skills?
  • For what new products, processes, methods or services will the knowledge and skills be used?
  • Or, if not new but improved products, processes or services are (were) pursued, what was the basis for this and of what does (did) the improvement consist?

Experimental development:

  • Place the project in the context of the company.
  • What existing scientific, technical or commercial knowledge or skill formed the basis for the R&D activities?
  • What technological progress does (did) the project attempt to bring about?
  • What obstacles / uncertainties does (did) the project attempt to overcome in order to make this technological progress?
  • What sort of activity is (was) planned in order to overcome these obstacles/uncertainties?   

If the R&D activity involves the development of software:

  • What is (was) the program’s area of application?
  • What is (was) its functionality?
  • Describe the technical challenge for which a solution is (was) being sought
  • What is (was) the concept used in the development of the software?  What thought processes (imperative, functional, logical, object oriented) and what program languages are (were) used?
  • Describe the various stages used to reach the solution; e.g. during the planning stage (requirements analysis), the design stage, the construction stage and the test stage?
  • What existing modelling programs, programming tools, components, methods and techniques are (were) used?
  • What methods and techniques are (were) self-developed?
  • How innovative for the company are the IT architecture, applications / interfaces, data architecture, and algorithms of the self-developed software? 


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