As of 19 August 2026, still a draft bill: The German cabinet approved the Annual Tax Act 2026 (Jahressteuergesetz 2026) on 12 August 2026. The Bundestag and Bundesrat still have to agree. Everything described here is therefore planned law, not law in force, and can still change during the legislative process. This article will be updated as soon as there is news.
The Annual Tax Act 2026 contains two changes to the Forschungszulage that matter above all if you are planning multi-year R&D projects or want to secure funding retroactively: the funding cap per project rises from 15 to 25 million euros, and a new rule (Ablaufhemmung) writes deadline protection during the certification procedure explicitly into the law. The funding cap is not the assessment base, which sits at 12 million euros per year. It caps how much funding you actually receive.
Here are both changes explained simply, plus a brief look at what else is in the act.
With an annual tax act, the legislator regularly bundles many smaller and larger changes from across tax law into a single package. The current draft includes, for example, digital tax assessment notices via ELSTER from 2027, higher interest on tax back payments and refunds (3.6 % instead of 1.8 % per year from 2027) and adjustments to withholding tax on capital income.
For innovative companies, though, it is the two points on the Forschungszulage that matter.
There are two limits in the Forschungszulage that often get confused:
It is this second cap that is now set to rise: EU state aid law now permits up to 25 million euros per company and project, while the Forschungszulage law stayed below that at 15 million euros. The draft raises the cap to the full 25 million euros.
What does that mean in practice?
You can claim the Forschungszulage retroactively for up to four years. The process has two stages: first the technical certificate from the BSFZ, then the assessment by the tax office.
In practice the following already applies today: what matters is that the BSFZ application is filed in time, within the four-year assessment period. It does not have to be decided by then. So far, however, this safeguard is not in the Forschungszulage law itself but follows from the general rules of the German Fiscal Code (Abgabenordnung) on basic assessment notices. In borderline cases, for instance when the certificate is disputed and the procedure drags on for years, that left some residual uncertainty.
The draft now writes the safeguard explicitly into the law (Section 12 FZulG draft): a certification application filed in time preserves the deadline, and the assessment period ends no earlier than two years after the end of the calendar year in which the certification body's decision became final.
What does that mean in practice?
These two changes are also notable because the signals from the classic grant programmes currently point in the opposite direction. For the Central Innovation Programme for SMEs (ZIM), the BMWE has stopped accepting new applications since 7 July 2026, because demand exceeds the available budget. A resumption is targeted for early 2027, but not committed.
The Annual Tax Act 2026, by contrast, brings no austerity package for the Forschungszulage, but a higher cap and more legal certainty.
The difference is structural: ZIM is a grant from a limited funding pot. Once it is empty, that is it, no matter how good your project is. The Forschungszulage is a statutory tax entitlement. If your project meets the criteria, you get the funding, with no competition for scarce budgets and no application freeze.
That is not a blank cheque, because a statutory entitlement also sits in a law that can change. Still, the direction the legislator is taking here argues for treating the Forschungszulage as a fixed element of your financial planning, rather than a fallback for when a grant programme dries up.
After the cabinet decision, the deliberations in the Bundestag and Bundesrat follow. Annual tax acts are typically passed towards the end of the year, and individual points can still change. Until then, the current rules for 2026 (12 million euros assessment base, 35 % for SMEs, 20 % overhead flat rate, 100 euros hourly rate for own work) are the basis for your applications.
As soon as the act is passed, you will find the update with the final rules here.
The Annual Tax Act 2026 would strengthen the Forschungszulage in two noticeable ways: more room for large, multi-year projects through the 25 million euro budget, and more legal certainty through the Ablaufhemmung. Both are still draft, but both are worth factoring into your planning now. Anyone still looking to claim open years retroactively should not wait for the act.
Are you planning a multi-year R&D project, or do you still have open funding years? A short call is enough to know what the planned changes would mean in your specific case.
Two things: the cap on state aid per company and R&D project is set to rise from 15 to 25 million euros (Section 4 (3) FZulG). And a new rule (Ablaufhemmung) would state explicitly in the law that a certification application filed in time preserves the tax assessment deadline (Section 12 FZulG draft). As of August 2026, both are still a draft.
Both together. It is one limit with a combined unit of measurement: what counts is the funding one company receives for one project. There is no additional overall cap across all of a company's projects, so if you run two clearly separate projects, each has the full budget. Note that under state aid rules a group of affiliated companies can count as a single company.
No, these are two different things. The 12 million euros are the maximum assessment base per fiscal year, meaning your eligible costs. The cap of 25 million euros refers to the funding itself and applies across all years of a project.
Mainly legal certainty. Even today it is enough to file the BSFZ application within the four-year assessment period, it does not have to be decided by then. So far this only follows from the general rules of the German Fiscal Code (Abgabenordnung). In future it would be written directly into the Forschungszulage law, and the assessment period would end no earlier than two years after the end of the calendar year in which the certification body's decision became final.
The draft provides for application from 1 January 2026. However, this only becomes binding once the Bundestag and Bundesrat have approved it. Annual tax acts are typically passed towards the end of the year, and individual points can still change during the process.
No. For the vast majority of companies the draft changes nothing about the calculation: the annual limits stay the same, and the cap per project is only relevant for very large, multi-year programmes. If you have open funding years, waiting costs you real money, because the four-year window keeps closing.
Because they are two different funding systems. ZIM is a grant from a limited budget pot, which is why the BMWE stopped accepting new applications on 7 July 2026. The Forschungszulage is a statutory tax entitlement with no funding pot that can run dry. If you meet the criteria, you get the funding.
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