The latest case law related to personnel expenses

What are the conditions for qualifying as a young doctor when recruiting?

New case law from January 2023 clarifies the criteria for qualifying as a young doctor.

In this case, the judges ruled that the condition relating to the first recruitment of a young doctor had not been met, on the grounds that his first permanent contract was in line with his level of education and skills.

The judges consider that : Production of previous employment contracts by Mr B, which are not very explicit about the nature of the tasks entrusted, and the latter's attestation on his honour are not sufficient to establish that this employee's previous hirings did not correspond to functions suited to his level of doctorate degree.. In terms of tax law, the fact that Mr. B's previous duties under a permanent contract were not in the field of research and development has no impact on his entitlement to the research tax credit. Consequently, it does not follow from the investigation that Mr. B's employment contract with SASP Services constitutes the first recruitment of a person holding a doctorate within the meaning of the aforementioned provisions of article 244 quater B of the French General Tax Code, from which SASP Holding is not entitled to claim the benefit."

Reminder: To qualify for young doctor status, you need to meet a number of cumulative conditions. They must be first permanent employment contract after obtaining the doctorate and linked to the level of the degree.

In this case, the justification provided by the company, in the form of various previous contracts and a sworn statement, was not considered sufficient. The judges considered that the employee's previous duties were related to his field of expertise, and that he therefore did not qualify for young doctor status.

Are sales and marketing functions eligible for the CIR?

New case law from January 2023 provides further information on this subject.

In this ruling, the tax authorities refused to allow employees belonging to the sales and marketing departments to qualify for the CIR, on the grounds that they could not be assimilated to research technicians.

The judges confirmed this decision, on the grounds that a : such participation in the preparation of the company's research and development projects, while consistent with their qualifications, duties and responsibilities within the company, does not mean that the employees concerned should be treated in the same way as other part of the activities described above, research technicians within the meaning of the aforementioned provisions, since the activities described cannot be considered, in accordance with these provisions, as "essential technical support for research and experimental development work". As a result, the company has no grounds for claiming that the corresponding staff costs are eligible for the research tax credit.

It should be noted here that the judges do not reject expenses on the basis of the employee's profile, but rather on the basis of the following criteria insufficient evidence the indispensable nature of their contribution to the project.

Our experts' advice on the subject: When drafting the supporting documentation, it's important to emphasize the indispensable contribution of employees to the project, especially when dealing with "non-technical" profiles.

Any doubts about the CIR eligibility of staff involved in your R&D projects?

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