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Knowledge Base / Financials / Eligible Costs and Expenses / Forfaitary Costs vs. Actual Costs

Forfaitary Costs vs. Actual Costs for WBSO Benefits

Q: What are forfaitary costs for WBSO?

Forfaitary costs are standardized costs predetermined by the government, simplifying the reporting process as you do not need to provide detailed documentation for each expense. Forfaitary costs cover various R&D activities, including labor, materials, and other related expenses.

Q: What are actual costs for WBSO?

Actual costs are the real expenses incurred during your R&D activities. Reporting actual costs requires detailed documentation and proof of all expenses, making this method more accurate but involving more rigorous record-keeping and substantiation.

Q: When should I choose forfaitary costs over actual costs?

If your total R&D costs are below the €18,000 to €20,000 range, forfaitary costs may be the simpler and more beneficial option. Beyond this range, actual costs might offer a higher tax reduction, especially if your R&D expenses are significantly high.

When applying for WBSO benefits, companies can choose between forfaitary costs and actual costs to calculate their tax reduction. Here's a comparison to help determine which option is more beneficial:

Forfaitary Costs

Standardized costs predetermined by the government

€10 per R&D hour for the first 1,800 hours, €4 per hour beyond that

Simplifies the application process as detailed documentation is not required

Actual Costs

Based on real expenses incurred during R&D activities

Requires detailed documentation and proof of expenses

Can potentially result in higher tax reductions if R&D costs are significantly high

Break-Even Point: Forfaitary vs. Actual Costs

If your total R&D costs are around €18,000 to €20,000, the choice between forfaitary and actual costs becomes important. The reason is that after 1,800 hours, the forfaitary rate drops to €4 per hour, slowing down the growth of the total forfaitary costs. At this point, if your total actual R&D costs exceed this range, it may be more beneficial to choose the actual costs, as they will continue to grow at a faster rate than forfaitary costs.

In summary, when total R&D expenses go beyond the €18,000 to €20,000 range, choosing actual costs might provide a greater tax reduction compared to forfaitary costs, especially if your actual hourly R&D expenses are high.

Example Comparison

Criteria	Forfaitary Costs	Actual Costs
R&D Hours	2,000	2,000
Cost per Hour	€10 for first 1,800 hours	€50 per hour (actual)
Additional Hours Cost	€4 per hour beyond 1,800	-
Total Forfaitary Cost	(1,800 * €10) + (200 * €4)	-
Total Actual Cost	-	2,000 * €50
Total Tax Reduction	€18,800	€100,000

Based on this comparison, if your actual R&D costs per hour are high, using actual costs might provide a more significant tax reduction compared to forfaitary costs.

Frequently Asked Questions

What are forfaitary costs for WBSO?

What are actual costs for WBSO?

When should I choose forfaitary costs over actual costs?

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