Act on innovation signed by the Polish President

The new act on innovation is to guarantee companies possibility to take advantage of substantial tax credits for research and development, while scientists are to benefit from commercialising their inventions to a much greater extent.

In accordance with the announcements of President Andrzej Duda, the solutions included in the new act to are bring a real growth of innovation, and therefore better functioning of Polish economy, better functioning of Polish science, and as a result a distinct change in terms of the quality of Poland’s position in the international arena. More attention is to be given to activities concerning intensification of investment costs and the results of innovative character. The event that took place in the Presidential Palace due to signing of the act was attended by Deputy Prime Minister, Minister of Science and Higher Education Jarosław Gowin, among others. The science teams whose projects are co-financed by the National Centre for Research and Development (NCBR) were also present.

The amendments to part of the acts stating the rules of conducting innovative activity prepared by the Ministry of Science and Higher Education, was called small, and at the time the first act on innovation. It is worth noting that it introduces a set of instruments that reward and motivate to take up activity of innovative character.

Pursuant to the provisions of the act, as early as 1 January 2017 the income tax on intellectual property contributed to a company will be abolished. Possibility to deduct costs of obtaining patents by small and medium enterprises has also been included in the new regulations.

Certainly, what is worth noticing is the fact that the provisions of the new act directly increase the amount of costs that may be deemed qualified research and development costs, and it is for those amounts that tax deduction is permitted. For microentrepreneurs and small and medium businesses this may be even up to 50 percent. Big companies will in turn be allowed to deduct as much as 50 percent of personnel costs and up to 30 percent of other costs within the scope of conducted research and development.

The new provisions will also give entrepreneurs a longer period for deducting research and development costs – according to the changes they will have as much as six years for that. The act also includes provisions regarding newly formed enterprises (the so-called start-ups) conducting research and development activity. They got a possibility to apply for cash refund in the amount of 18 or 19 percent within a potential but not used deduction.

The new regulations are also a set of provisions for scientists, e.g. modifications within the scope of the rules for obtaining property rights to inventions. The new provisions remove the previously functioning time limits for inventors working at schools of higher education concerning the shares in benefits from commercialisation they are entitled to.