The Research Tax Credit (RTC) case law deals with the eligibility of seasonal workers in agriculture

The earnings of seasonal workers who (i) work closely with researchers (ii) to provide technical support for research and experimental development work could be included in the RTC base as expenses of research technicians, regardless of their qualifications or seniority. The debate shifts to the question of proof of this close collaboration, following a logic similar to the consideration of trainees.

Consideration of seasonal workers for the RTC possible in principle, subject to sufficient justification.

Two administrative courts of appeal have recently ruled on the eligibility for the RTC of expenses relating to research work carried out by seasonal workers.

Before the court of appeal of Nantes, SAS Germicopa argued that the technical support of seasonal workers was indispensable for its research activities relating to the development of new potato varieties.

These workers were in charge of planting, maintaining, monitoring and harvesting the seedlings. Their work, carried out in greenhouses or experimental micro-plots, had to follow a precise protocol established in advance by the researchers, in order to ensure traceability, selection and identification of seed potatoes.

According to the Court:

  • This work provides essential technical support for the company’s research work
  • The taking into account of the remuneration of these workers within the framework of the RTC is not conditional on their level of qualification
  • The lack of seniority of these workers cannot, in itself, reveal an absence of technicality of the tasks entrusted to these employees

Since the administration does not dispute the close collaboration between seasonal workers and researchers, it was held that these seasonal workers can be regarded as research technicians within the meanings of the RTC, and that the remuneration of these workers therefore constituted eligible research expenditure.

However, it is up to the company to provide enough evidence, which is the reason for rejection adopted by the court of appeal of Douai in the case concerning KWS Momont.

In connection with field seeds research, it was considered that the information provided, in particular the employment contract, which does not include a precise description of the conditions for carrying out the tasks summarily defined, and the summary table of the work carried out (which does not mention the names of the seasonal workers) did not make it possible to establish the close collaboration between the seasonal workers and the researchers.

  • CAA de Douai, 12/11/2019, n° 17DA01657, KWS Momont
Lucille Chabanel

Lucille has more than 14 years’ experience in tax law. She is a member of the corporate tax department since 2002 and joined the R&D group in 2004. She has […]

Béatrice Prim

Beatrice, a Senior Manager who has been attached to the research and development team since 2010, advises her clients on CIR (security, defence during tax audits) and coordinates missions on […]