CIR Report: How to Properly Formulate Scientific Criteria
A company undergoing a CIR tax audit is evaluated based on the complete CIR report (administrative, financial, and scientific) that has been submitted to the tax authorities.
It is the scientific report that will determine whether the project is, in principle, eligible for the CIR. On the one hand, the advancement of knowledge must be demonstrated by the state of the art, for which we have provided our writing guidelines. On the other hand, the R&D work must involve resolving scientific uncertainties and/or technological bottlenecks.
Contrary to popular belief, the tax authorities place greater emphasis on a clear description of the technical challenges than on the results achieved by the R&D project.
Definition: Scientific or technical barriers, according to the CIR guide
According to the Research Tax Credit (CIR) guide, a scientific or technical bottleneck is defined as an obstacle that must be overcome in the course of scientific research. It refers to a problem or uncertainty for which no solution exists based on the current state of available knowledge.
The primary objective of R&D eligible for the CIR is to overcome these scientific or technical barriers. To qualify as such, the barrier must be sufficiently complex to require a rigorous and methodical scientific approach.
This definition emphasizes the importance of innovation and research in solving complex technological problems. Companies that invest in overcoming such obstacles are eligible for the CIR.
Scientific or technical barriers?
Understanding the distinction between scientific and technical bottlenecks is essential in the context of the CIR. A scientific bottleneck is an obstacle that hinders the progress of a research and development (R&D) project, requiring a new scientific or technological solution. It represents a major uncertainty stemming from a lack of knowledge or existing solutions.
In contrast, a technical barrier refers to a more specific obstacle related to the practical aspects of implementing a technology or method. It can be overcome by applying non-standard techniques.
In the context of the CIR, identifying scientific barriers is of paramount importance. This is what determines the innovative nature of the project and, therefore, its eligibility for the CIR. Technical barriers, while significant, do not have the same impact on CIR eligibility.
Categories and examples of various scientific locks
Scientific bottlenecks fall into different categories, each with its own characteristics and implications for the research project.
- Global scientific bottlenecks are those that affect the entire R&D project. They are directly linked to the project’s main objective and require a comprehensive scientific approach to be resolved.
- Specific scientific bottlenecks relate to particular aspects of the project. They require dedicated attention, but resolving them does not necessarily affect the project as a whole.
- Finally, unforeseen scientific obstacles arise during the course of the project. These are generally related to unexpected technical issues or the emergence of new challenges during the research process.
Each of these categories of scientific bottlenecks presents its own challenges and requires different strategies for resolution. It is crucial to clearly identify them and describe them in detail in the CIR’s scientific report.
Global scientific barriers
Global scientific bottlenecks refer to the major obstacles that hinder the achievement of an R&D project’s overall objective. They are generally linked to gaps in the current state of knowledge or existing technological limitations.
These barriers can arise in various areas, such as:
- The lack of methods or technologies needed to achieve a specific goal.
- The challenges associated with miniaturization or the optimization of certain technologies
- The current limitations of scientific knowledge, which make it difficult, if not impossible, to carry out certain stages of the project.
Overcoming these obstacles requires significant research and development efforts, and resolving them is often a prerequisite for the success of the project as a whole.
Specific scientific barriers
Specific scientific bottlenecks focus on particular issues within the R&D project. While resolving these issues is crucial for certain parts of the project, it does not necessarily affect its overall objective.
These locks may affect components such as:
- Product shortages: the lack of products that meet specific project requirements can be a major obstacle.
- Extending the approach to broader domains of business knowledge: for example, applying machine learning techniques to specific domains could present a particular scientific challenge.
It is essential to clearly identify these specific barriers and describe the research and development methodology used to overcome them.
Unexpected scientific obstacles
Unforeseen scientific bottlenecks often arise during the course of an R&D project, when unexpected technical problems occur or new issues emerge. Unlike general and specific bottlenecks, they are not initially identified during project planning.
- They may be related to unforeseen technical challenges that call into question the feasibility of the planned methods or processes.
- They may also result from unexpected scientific discoveries that alter existing knowledge and require a reorientation of research.
- Sometimes they are linked to external factors, such as regulatory changes or supply constraints that affect the use of certain technologies or materials.
Dealing with these unexpected obstacles requires a high degree of flexibility and adaptability, as well as a responsive and creative problem-solving approach.
How do you resolve a scientific bottleneck and present it in your CIR scientific report?
To overcome a scientific bottleneck, it must first be clearly identified. This involves understanding the nature of the problem, its origin, and why it constitutes an obstacle to the project’s progress. Next, a suitable scientific approach must be devised to overcome it. This may involve, for example, conducting basic research, applied research, or experimental development.
Once you have resolved the bottleneck, you must document this process in your CIR scientific report. You will need to describe the bottleneck, explain the steps taken to resolve it, and demonstrate how this contributed to the progress of your project. Be sure to link the bottleneck to a lack of solutions or a knowledge gap, reflecting the state of the art, as recommended in the CIR guide.
Don't forget to:
- Describe the lock in detail
- Explain the scientific approach used to overcome the obstacle
- Show the impact of lifting the restriction on the project's progress
This documentation will allow you to demonstrate the authenticity, complexity, and novelty of your R&D work to the tax authorities, thereby increasing your chances of qualifying for the CIR.
Dynergie, a CIR-certified consulting firm
Do you have questions or are you having trouble drafting your technology barriers for your CIR scientific report? You can contact us via our contact page. We are listed as a CIR-CII participant by the Business Ombudsman.
Useful links:
> Spotlight on the 2024 Budget Act: C3IV, JEI, and Other Measures
> CIR Reform: An Analysis of Upcoming Changes
> The reform of the JEI status in the 2024 Finance Act: what remains of the Midy report?
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Damien Villiers-Moriamé
I assist innovative companies of all sizes in securing public funding (CIR-CII, JEI, bpifrance, CIN, etc.). My technical expertise spans a variety of fields, including IoT, AI, e-learning, embedded systems, and service robotics. My daily work involves supporting entrepreneurs through key and critical stages of their projects (developing a financing plan, creating a business plan, and validating the business model).