Why This Article Matters (and What Many Companies Underestimate)
In practice, funding rarely fails because of the idea – it fails because costs, and specifically personnel costs, are not cleanly assigned to the innovation project or are not documented completely. Companies that get this right often recover five- to six-figure sums quickly – even when the company is currently not making profits (payment/refund is possible when the credit exceeds the tax liability).
Which Personnel Costs Are Eligible for the Forschungszulage?
For Forschungszulage personnel costs, the following are primarily eligible:
Wages and salaries (subject to wage tax) of employees working on the eligible project
Future security contributions by the employer (typically employer shares of social insurance, to the extent eligible)
(In certain cases) own work by sole proprietors / co-entrepreneurs, at the statutory hourly rate
Important: What matters is not the job title or department, but the actual activity within the innovation project.
Calculating Forschungszulage Personnel Costs: How to Determine the Eligible Share
The calculation follows a clear principle in practice:
Determine total personnel costs per employee for the fiscal year (gross wages + eligible employer components).
Determine the project share: what demonstrable proportion of working time was spent on the eligible innovation project?
This gives the eligible assessment base per person:
eligible personnel costs = total personnel costs × project time share
Apply the funding rate to the total:
Standard: 25%
SMEs (upon application / when criteria are met): 35%
How do you arrive at the project time share? This is how the calculation aid in the video below works: the numerator is the R&D hours from your time tracking, and only those spent on the eligible project (preparing for a trade fair, for example, does not count). The denominator is the available hours: working days minus public holidays, vacation, sick leave and other absences. In the simplified example for 2024 (Berlin, 40-hour week), 212 of 262 working days remain, so 212 × 8 h = 1,696 available hours. With 1,272 R&D hours, that gives a share of 75.0%. Which method suits your company is best agreed with your tax advisor.
project time share = R&D hours on the project ÷ available hours
Explainer video by Erich Lehmann, co-founder of Zeitmaker (43 seconds, in German): how the calculation aid derives the R&D share in a simplified example.What happens in the video
The calculation aid determines a person's R&D share with one formula: R&D hours divided by available hours.
Denominator, available hours: 2024 has 262 working days from Monday to Friday. Subtract 10 public holidays (Berlin), 30 vacation days, 8 sick days and 2 other days of absence. That leaves 212 net working days, at 8 hours a day 1,696 available hours.
Numerator, R&D hours: taken from time tracking. Only hours spent on the eligible project count; non-eligible activities such as preparing a trade fair appearance are left out. In the example that is 1,272 hours.
R&D share: 1,272 ÷ 1,696 gives 75.0%. The calculation aid then shows an overview per person, per project and per year.
The calculation aid comes with a caveat: the final review and legal assessment lie with your tax advisor. Example figures for 2024, Berlin, 40-hour week, simplified presentation.
Brief Example After the March 2024 Amendment (one employee)
Maximum credit per year (from the assessment base):
from 28.03.2024: up to €2.5 million (SMEs: €3.5 million)
from 01.01.2026: up to €3.0 million (SMEs: €4.2 million)
Own work (entrepreneur hours):
from 01.01.2026: €100 / hour (at max. 40 hrs/week, for specific groups only)
Documentation: No Personnel Cost Funding Without Evidence
For personnel costs to be recognized, you need a plausible, consistent, and auditable basis – typically:
a clear activity delimitation (what is "innovation in the project" vs. routine/support?)
time tracking or equivalent internal records (project-related)
payroll records (as the basis for personnel costs)
a clear project structure (work packages / milestones) so that the time share can be logically explained
Documents needed to calculate and substantiate personnel costs: time tracking, payroll account, project structure.
If you are just getting started: our Forschungszulage consulting takes on exactly this allocation, from the role logic within the team to complete, traceable filing of the time records. We take over the payroll journal and working hours, calculate the hours per person and project, and give you our assessment of which shares can be claimed, subject to your tax advisor's final review.
Application and Process: Two Stages (BSFZ + Tax Office)
Scalable: through the high assessment limits (from 2026 up to €12 million).
Frequently asked questions
Eligible are primarily wage-tax-liable salaries and wages of employees working on the innovation project, plus certain employer contributions for future security (e.g. relevant social insurance employer shares).
You need (1) total personnel costs per person and (2) a demonstrable project time share. The eligible amount is then: costs × project share.
The standard rate is 25%; for SMEs (if the criteria are met and an application is filed) it is 35%.
Yes. If the Forschungszulage exceeds the tax liability, the difference is generally paid out.
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