BlogCorfo Certification How to build an R&D project budget: expenses Corfo accepts
Under the R&D Law, the benefit is calculated on certified expenditure. That makes the budget much more than paperwork: it determines how much tax credit you’ll get. A poorly built budget can end in partial certification.
Accepted expense categories
Corfo details accepted expenses in its Exempt Resolution No. 17. They fall into two broad groups.
Current expenses
| Category | What it includes | Watch out for |
|---|---|---|
| Staff | Salaries and fees of the technical and professional staff involved | Valued by % of time allocated. At least 50% of the work in Chile |
| Materials and supplies | Reagents, materials, IT services, lab analyses, bibliography | Must be directly linked to the activities |
| Subcontracts | Services from legal entities directly related to the project | At least 50% carried out in Chile |
| Rentals | Movable or real property needed for the project | Justify the need |
| Intellectual property | Costs of registering patents, utility models, software rights or plant varieties | Must come from the certified project |
| Utilities | Water, electricity, phone, internet | Capped at 5% of current expenses |
Capital expenses
- Equipment and instruments, including insurance, shipping, import and commissioning accessories.
- Infrastructure: building, fitting out or acquiring property the project requires.
Valued vs. paid out
This is a key distinction. According to Corfo, only staff costs can be valued: if an in-house engineer spends 40% of their time on the project, you can charge 40% of their cost. Every other expense must be an actual payment, backed by an invoice and proof of payment.
Five rules for a good budget
- Link every line to an activity. Each expense should answer “which R&D activity is this for?”. A Gantt chart with activities and costs helps a lot.
- Use market prices. Corfo checks that costs match market conditions. Back them with quotes.
- Be realistic about time allocation. The whole team at 100% for years is hard to believe and hard to support later.
- Separate R&D from operations. Normal production, sales or maintenance costs aren’t project costs.
- Request anything not on the list explicitly. If you need an expense that isn’t among the accepted ones, you can request it in the same application, explaining its nature and justification.
If there’s public funding
If part of the project is funded by a grant, you must declare it in the application, and the credit only applies to what the company pays with its own resources. See Public grants and the R&D Law.
The budget lives on afterwards
What you certify is what you’ll later have to support before Corfo and the SII. Significant changes in amounts must be reported to Corfo, and increases may trigger an additional fee. See After certification.
This article is for information only and is not tax advice. Sources: Corfo Exempt Resolution No. 17, Certification Regulation (Supreme Decree 102/2012) and Corfo’s FAQ.