On 7 July 2022, the House of Representatives passed amendments to the Income Tax Law.
The changes are discussed below.
Increased deduction by 20% on the actual expenditure incurred on scientific research as well as research and development
According to the new provisions of the Law, an increased deduction of 20% will be granted on the actual expenditure for scientific research as well as
research and development, as recognized on the basis of the international accounting standards, incurred by a person carrying on a business and who has the
economic ownership of the intangible asset that results or may result from incurring such expenditure.
The increased deduction will also be granted in the cases where the expenditure that will be incurred will be of a capital nature and capital allowances will be
claimed on the said expenses.
The increased deduction that will be granted based on the provisions discussed above cannot be claimed in the cases where a deduction will be claimed on the
qualifying profits that are generated by a qualifying intangible asset based on the provisions of section 9(k) of the Law.
The increased deduction discussed above will apply on the expenditure that will be incurred during the years 2022, 2023 and 2024.