Cybersecurity · Case study

Research allowance for IT security: contract research fully recognised.

Practical example based on real projects · anonymised, figures rounded · Last updated: 24 September 2026

A cybersecurity provider for confidential computing had an unusually high contract-research share recognised in full, on an eligible base over €1.3 million.

€430,000

research allowance granted

€1.3M

eligible base

Up to 35%

SME funding rate

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At a glance

The mandate in figures

IndustryCybersecurity / cloudConfidential computing

Research allowance granted€430,000Fully claimable, credited against tax, surplus refunded

Eligible base€1.3M

ScenarioCertified; external share recognised

Projects1

SME funding rateUp to 35%

About the company

The company, and the R&D underneath

The company develops a platform that processes confidential data so that it stays protected even during processing, and across several cloud providers. This is a hard technical field: achieving confidentiality at runtime, cross-vendor compatibility and robust security guarantees at once is not trivial and was not solved at the project start.

A substantial part of this development was contracted out to external specialists. So a large part of the eligible base depended on this external work being recognised as contract research.

The challenge

Where the funding really sat

Contract research is eligible only if the contractor independently solves a scientific or technical problem. With a high external share, exactly that becomes the pivot. If the external work is classified as a pure service, a large part of the funding collapses.

There were also several decision versions in the procedure. Such constellations are delicate: it must be ensured that the final, authoritative version maps the funding base correctly and completely.

Novelty Technical risk / uncertainty Systematic approach

Our approach

How we built the case

We set up the contract research from the start as what it is: the independent solution of a technical problem with an open outcome. For each external contribution we showed which concrete uncertainty was addressed there and why it is not routine. The work was commissioned result-oriented, not as the mere provision of labour.

We carefully reconciled the final decision version against the declared funding base, so the recognised expenditure takes full effect. As a result, the contract research was recognised; together with the in-house work it forms a balanced eligible base.

How the case moved

↻

Set up

External work as result-work

↻

Reconciled

Final decision checked

✓

Recognised

High external share, in full

What made up the eligible base

In-house ~50%Contract research ~50%

In-house personnel workContract research (recognised in full)

Eligible base over €1.3 million, in-house work and contract research roughly equal, both recognised. Split shown is illustrative.

The result

A €430,000 research allowance.

The eligible base is around €1.3 million across fiscal years 2023 to 2025, roughly equally from in-house work and recognised contract research. At 25% on the costs up to March 2024 and the 35% SME rate after that, this yields around €430,000 of research allowance. That the high external share carries in full is the real result of this case.

Eligible base €1.3M · SME rate Up to 35%

Certified; external share recognisedThe outcome of the mandate.

Eligible base €1.3MRecognised cost the allowance is calculated on.

SME rate Up to 35%Applied to the eligible base.

Key takeaways

What other companies can learn

A high contract-research share is not an obstacle, if it is set up correctly. Three points are decisive:

01

Commission result-oriented

The contract must visibly owe a result and independently solve a technical problem. Staffing is not eligible.

02

Show the uncertainty externally too

Contract research is eligible only if real failure risk existed there. That belongs explicitly in the description.

03

Check the final decision version

With several versions, the last one counts. It must map the funding base correctly, otherwise recognised expenditure is lost.

More on Research Allowance: The guide Research Allowance: requirements, rates and application explains the programme step by step. How we support your project is covered under Research Allowance consulting.

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Contract research is often the weak point of an application, here it is the strength.

BeFunded On the research allowance

FAQ

Research Allowance: your questions

The most common questions on this kind of case. Short answer first, detail after.

Yes, insofar as it goes beyond the state of the art and is tied to scientific-technical uncertainty. Security research with an open outcome is a typical funding case; standard configuration and operations are not.

Yes, if every external contribution independently solves a technical problem and is commissioned result-oriented. The size of the share alone is not a reason for exclusion.

In the relevant periods, 60% of the recognised contract cost. The funding rate is applied to that.

The final, possibly signed version is authoritative. It should be reconciled against the declared funding base so all recognised expenditure takes effect.

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