Annex FZ — Mandatory Annex to the Tax Return
Annex FZ has been the official mandatory annex to the corporate (KSt) or income (ESt) tax return since the FZulG took effect in 2020. It is submitted exclusively electronically via ELSTER.
Fields in detail
| Line | Content | Example |
|---|---|---|
| 1–4 | Master data (name, tax number, fiscal year) | NOVARIS GmbH, 123/4567/8901, 01.01.–31.12.2026 |
| 10 | BSFZ certificate number | BSFZ-2026-00123 |
| 11 | Date of BSFZ certificate | 2026-03-15 |
| 20 | Eligible personnel costs / own work | EUR 800,000 |
| 21 | Contract research (70 % eligible) | EUR 350,000 |
| 22 | Overhead flat-rate (20 % since 2024) | EUR 230,000 |
| 30 | Total assessment basis (max EUR 12 M) | EUR 1,380,000 |
| 40 | Funding rate (25 % standard / 35 % SME) | 35 % |
| 50 | R&D tax credit to be assessed | EUR 483,000 |
ELSTER — Submission & Mandatory Fields
Since 2024, Annex FZ can only be transmitted electronically via ELSTER. Five steps:
- 1
Select Annex FZ in ELSTER
In your ELSTER personal area under "Tax Return → Annexes" select Annex FZ.
- 2
Upload BSFZ certificate as PDF
Mandatory attachment. Without the BSFZ certificate, the tax office will reject Annex FZ.
- 3
Fill in the fields per table
Assessment basis, funding rate, credit to be assessed. ELSTER validates automatically.
- 4
Reconcile E-Bilanz position
"Other operating income" must be consistent with Annex FZ.
- 5
Submit authenticated
With ELSTER certificate or ELSTER Stick. A confirmation e-mail alone is not sufficient.
Mandatory attachments
- BSFZ certificate (PDF, from the certification body portal)
- Time records aggregated per employee (Excel/CSV export)
- Contract research agreements for external R&D in the EEA
- For different bank account: form "Bankverbindung zur Erstattung von Steuern"
Interaction with Corporate/Income Tax
The Forschungszulage is a true tax credit, not an expense reduction. It is offset against the assessed KSt/ESt — any excess is paid out as a refund.
| Legal form | Tax type | Offset | Special feature |
|---|---|---|---|
| GmbH / UG | KSt 15 % + SolZ 5.5 % | Full KSt offset | Loss case: credit as refund |
| Sole proprietor | ESt 14–45 % | Full ESt offset | SME rate 35 % if < 250 employees |
| Partnership | Pro-rata per partner | At partner level | Special form Annex FZ-Mitunternehmer |
Trade Tax — Off-Balance-Sheet Reduction
Under § 9 No. 7c GewStG, the Forschungszulage is exempt from trade tax. To activate this exemption, the credit must be reduced off-balance-sheet in the trade tax return.
Example — what happens without the reduction
| Position | With reduction (correct) | Without reduction (mistake) |
|---|---|---|
| Forschungszulage | EUR 500,000 | EUR 500,000 |
| Trade tax base increased | EUR 0 (reduced) | EUR 500,000 |
| Munich rate (490 %) | — | 3.5 % × 4.9 = 17.15 % |
| Unnecessarily paid trade tax | EUR 0 | ~EUR 85,750 |
Loss Carryforwards & Minimum Taxation
One of the strongest features of the Forschungszulage: it does not increase taxable income — loss carryforwards remain fully intact.
- No interaction with the minimum taxation under § 10d EStG (EUR 1 M + 60 % above)
- Even with cumulative losses of EUR 5 M, the credit is paid out fully without consuming any loss carryforward
- Particularly valuable for startups: cash refund despite zero tax liability + loss carryforward preserved for future profits
Interaction with § 7g EStG (Investment Deduction)
The investment deduction (Investitionsabzugsbetrag, IAB) under § 7g EStG allows SMEs to deduct up to 50 % of the cost of future investments in advance. IAB and Forschungszulage can be combined — but watch out for double funding.
Example calculation
| Step | Value |
|---|---|
| Acquisition R&D machine | EUR 200,000 |
| IAB under § 7g (50 %) | −EUR 100,000 |
| Residual book value for depreciation | EUR 100,000 |
| Eligible depreciation for FZulG basis | only on EUR 100,000 |
Special Cases: Organschaft, Partnership, Non-Calendar Fiscal Year
Organschaft (German tax group)
For a corporate-tax Organschaft, Annex FZ is filed by the parent (Organträger), not by the controlled subsidiary (Organgesellschaft). The assessment basis is consolidated across all subsidiaries. BSFZ certificates remain individual per subsidiary, but the Annex FZ is consolidated.
Partnership (KG, OHG, GbR)
For partnerships (Mitunternehmerschaften), each partner's share of the credit is assessed separately. In the partner's tax returns, the offset is made via Annex FE-K (corporation) or Annex SO (individual). The unified Annex FZ remains at the partnership level.
Non-calendar fiscal year
For a fiscal year other than the calendar year (e.g., April–March), the assessment basis is allocated per fiscal year. Personnel costs are pro-rated to the fiscal year in which the work was performed — not to the calendar year.
FAQ: R&D Tax Credit in the German Tax Return
The Forschungszulage is reported via Annex FZ of the corporate (KSt) or income (ESt) tax return. Mandatory annex since 2020, ELSTER transmission. Assessment basis, funding rate, credit to be assessed are entered — the BSFZ certificate must be attached as PDF.
Yes — as off-balance-sheet reduction in line 87 GewSt 1A (§ 9 No. 7c GewStG). Forgetting means paying 14–17 % trade tax on the credit. For EUR 500,000, that's roughly EUR 70,000–85,000 unnecessarily paid tax.
Under "Other operating income" in the German taxonomy (de-gaap-ci_is.netIncomeFromOrdinaryActivities.otherOperatingIncome). Separate labeling not strictly required but recommended via the "Explanation of other operating income" note field.
Yes — retroactively up to 4 years via § 169 AO, for fiscal years from 2020. The BSFZ certificate must be applied for separately. NOVARIS reviews free of charge whether a retroactive claim makes sense.
File an appeal under § 347 AO within one month. The BSFZ certificate is binding for the tax office — only arithmetic is reviewed. Common rejection reasons: unclear time records or wrong contract-research quota. NOVARIS supports the appeal process.
Yes, indirectly: The credit is offset against KSt/ESt before the SolZ (5.5 %) is calculated. If KSt/ESt drops, SolZ drops too — additional ~5.5 % benefit. For EUR 500,000 credit: ~EUR 27,500 SolZ savings.
No. The credit is neither a supply nor a service in the VAT sense. It does not appear in the VAT return. Booked gross without VAT key (account 2749 SKR03 / 7695 SKR04).
