Switching Forschungszulage Consultants: How to Do It

If you are reading this, you have probably already made the decision. The question is no longer whether, but the practical one: what do I need to do, in what order, so that nothing gets lost in the switch, neither documents nor funding years nor time?

That is what this article covers. Not a case for switching, just the process.

When a switch typically comes up

Three triggers are by far the most common in practice:

• A BSFZ rejection that looks avoidable in hindsight, because the technical reasoning in the application was thinner than the development work actually performed.
• A disappointing amount: the notice arrived, but the figure underneath does not match the development work that genuinely took place in the company.
• The working relationship itself: slow responses, too many iteration loops with your own engineering team, or the feeling that you ended up writing the application yourself anyway.

All three are legitimate reasons. For the mechanics of switching, though, the trigger barely matters. The steps are the same.

The right timing

The Forschungszulage runs in two stages: first the technical review by the certifying body (BSFZ), then the assessment by the tax office via your tax return. Both stages run separately per financial year. That gives you three workable moments to switch.

1. Between two funding years. The cleanest case: the tax office notice for the previous year has arrived, the next year has not been touched yet. No open deadlines, no half-finished project descriptions, no question of who is responsible. If your switch is not urgent, wait for this point.

2. After the BSFZ certificate, before the step to the tax office. Also straightforward. The certificate belongs to your company and is valid regardless of who applied for it. The second step runs through your tax advisor and ELSTER anyway. Only one thing matters here: the figures entering the tax office procedure have to match the certificate. Whoever prepares that filing needs the predecessor's complete cost breakdown.

3. In the middle of a pending BSFZ procedure. Possible, but it requires coordination. While an application is under review, the BSFZ may send queries, and the response windows for those are typically short. Before terminating, clarify in writing who answers an incoming query, by when, and how you find out about it.

One point that often gets overlooked: if one of your retroactive years is close to its deadline, that year in particular should not get stuck between two providers. The Forschungszulage can typically be claimed up to four years retroactively, with the deadlines running per calendar year. How to plan around that is covered in claiming the Forschungszulage retroactively.

Reviewing the old contract: a checklist, not legal advice

Contracts in funding consulting are built very differently from one another. There is no standard, which means nothing general can be said here. What you can do: check specifically whether your contract regulates the following points, and have it reviewed legally if in doubt.

1. Term and notice period. Is the contract tied to one funding year, to one application, or to a fixed period? Is there a minimum term?
2. Automatic renewal. Does the contract renew silently unless you terminate by a cut-off date? If so: when is that date, and does it fall before or after the next funding year?
3. What the fee is owed for. Per application submitted, per funding year, per allowance paid out, or on an ongoing basis? This is the point most often remembered differently from how it is written.
4. Years already submitted. Does the contract address what happens to claims for years that have been submitted but not yet decided or not yet paid out?
5. Pending applications after the contract ends. Does it say who finishes a procedure that is pending at the point of termination, and whether that carries an additional fee?
6. Release of documents. Is there a provision on returning documents and data after the contract ends, and in what format?
7. Powers of attorney and access rights. Were any authorisations granted or access rights set up that should be explicitly revoked along with the termination?

Who owns the documents, and what to secure beforehand

The substance of your application comes from your company: your projects, your people, your costs. Even so, it is considerably easier to request documents before terminating than afterwards. Not for legal reasons, but practical ones.

Ask for them specifically, ideally as a list in an email:

• The project descriptions in full text, exactly as submitted to the BSFZ, in an editable format rather than a PDF export.
• The cost breakdowns per project and per financial year, including how they were derived: which people at which share, which contract research, which fixed assets.
• The timesheets and allocation lists the personnel costs are based on.
• All notices and submission confirmations from the BSFZ, plus the applications in the version submitted.
• The complete correspondence with the BSFZ, in particular queries and the answers given to them. This is precisely where you can see what an application got stuck on.
• The values transmitted to the tax office per year, so that the following years connect to them consistently.

You need these documents regardless of the switch: in a later tax audit you have to be able to substantiate the costs claimed, and that obligation stays with your company, not with the consultant. More on this in Forschungszulage documentation.

What happens to a pending BSFZ application

In short: nothing dramatic. A BSFZ application is not a consultant's asset. The applicant is your company, and it is submitted digitally through the BSFZ portal using your company's ELSTER certificate. A change on your side does not cause the BSFZ to discontinue a procedure.

Three situations are worth distinguishing:

• Application under review. The procedure continues. Just make sure queries actually reach you and get answered. Check who has portal access and which email address is stored there.
• Open query. This is the one case where speed matters. Response windows are short, and an unanswered query is the most avoidable route to a rejection. Settle responsibility before you terminate.
• Application rejected. A rejection refers to the project as submitted. Revising and resubmitting is possible, as is an objection within one month. With the Forschungszulage, only the tax office notice is final, not the BSFZ decision. Which option makes sense when is covered in Forschungszulage rejected: what you can do now.

Handover to the new provider

A new provider can pick up seamlessly if they get three things: the status of the procedures, the history, and the raw data.

Status of procedures: which financial years are submitted, decided, paid out or still open? A simple table with one row per year is enough and answers most follow-up questions in advance.

History: the project descriptions as submitted and, above all, the BSFZ queries. Anyone who knows which line of argument failed to convince last time does not have to repeat the mistake.

Raw data: staff lists with roles and salaries, time tracking or timesheets, contract research agreements, the fixed asset register. The closer to the source, the better, since the allocation will be reassessed anyway.

A good provider works through this themselves and bundles their questions instead of sending your engineering team round in loops. What that process looks like in detail is described in how a Forschungszulage consulting engagement works.

Self-check: seven places where funding may have been left behind

Before you switch, it is worth looking back at the last application. Not to prove a point, but because retroactive years are often still open and gaps can be made up.

1. Were all projects captured? Frequently only the obvious flagship project makes it into the application, while smaller development efforts and internal technical work are missing.
2. Is every employee allocated proportionally? It is not only full-time developers who count. Proportional contributions from technical leadership, testing or design engineering belong in there too, if they can be plausibly evidenced.
3. Was the SME increase applied for? It is not granted automatically, only on application. Whether you qualify as an SME depends on headcount, turnover or balance sheet total, and partner and linked enterprises count towards it. Details in the SME definition for the Forschungszulage.
4. Was contract research included? External development work can be claimed proportionally. It is often overlooked because it does not appear as personnel cost in the books.
5. Were fixed assets checked? Depreciable movable fixed assets that are necessary for a project can feed proportionally into the assessment base. See fixed assets in the Forschungszulage.
6. Were the retroactive years used? Companies that started late often applied only for the current year and left the previous ones untouched, even though the deadlines were still open.
7. Would the documentation survive an audit? The notice is not the end. If timesheets, allocations and project boundaries are inconsistent, the risk materialises later, in the tax audit.

If you are unsure about more than two of these points, that is the real reason not to postpone the switch any further: the open years keep running.

If you switch to us

We take over existing engagements regularly and start by reviewing the documents you received from your predecessor, before anything new gets written. How our Forschungszulage consulting works and what it costs is set out on the consulting page.