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V0463-14 20 February 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · deducción por investigación y desarrollo

Developing ticket management software is not R&D, but could constitute technological innovation

A festival company has enquired whether developing software to manage invitations and accreditations qualifies for R&D tax deductions. The DGT has ruled that this does not constitute R&D, but notes that it could qualify as technological innovation subject to certain requirements.

The question raised

Whether the consulting entity can apply the deduction for research, development, and technological innovation activities, understanding that the new software involves the creation of a new commercial and management process that differs substantially from the process currently in existence.

The DGT's ruling

Software development does not constitute R&D if it does not involve significant scientific or technological progress through new theorems, algorithms, operating systems, or languages. However, it could be classified as technological innovation if the software represents a technological advancement in obtaining new processes or substantial improvements to existing ones. To this end, the novelty must be technological, essential, and must not consist of routine efforts or aesthetic modifications.

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