Research and Development Cash Rebate Scheme

Application Guide

 

The Scheme

  1. The Research and Development Cash Rebate Scheme (the Scheme) aims to reinforce the research culture among private companies and encourage them to establish stronger partnership with designated local public research institutions. The Scheme is administered by the Innovation and Technology Commission (ITC).

 

Eligibility

  1. To encourage companies to invest more in research and development (R&D), the Scheme provides a cash rebate equivalent to 40% (Note) of a company’s expenditure in two types of applied R&D projects -

     

    1. Innovation and Technology Fund (ITF) projects
      R&D projects funded by the ITF; and

    2. Partnership projects
      R&D projects funded entirely by companies and conducted in partnership with designated local public research institutions.

       

    Note : The level of cash rebate has been increased from 30% to 40% effective from 24 February 2016

  1. Please visit http://www.itc.gov.hk/en/funding/itf.htm for details of the funding schemes under ITF and the administration of ITF projects. For Partnership projects, the following types of work or activities will not be eligible for cash rebate under the Scheme -
  1.  
    1. product enhancement/customisation and related work, conventional operation or/and business activities without research content, such as product design and general system automation;
    2. companies’ in-house R&D work; and
    3. research projects outside the science and technology fields such as market research and management studies.

 

  1. The designated local public research institutions include -

    1. local universities;
    2. R&D Centres set up under the ITF;
    3. Hong Kong Productivity Council;
    4. Vocational Training Council; and
    5. Hong Kong Institute of Biotechnology.

Contact information of the designated research institutions are in paragraph 21 below.

 

Application and Payment Procedures

  1. Application for cash rebate under the Scheme should be submitted in the form of hard copy by the company concerned to the ITC by post or in person within two years after completion of the relevant R&D project (in the case of Partnership projects, applicants are also required to submit a pre-registration to the ITC as described in paragraph 9 below). The designated local public research institution or other parties cannot submit application on behalf of the company.
ITF projects
  1. Companies’ contributions to ITF projects broadly fall into two categories -

    1. under a platform project, the company (or together with other companies) will contribute at least 10% of the project estimate; and

    2. under a collaborative project, the company will contribute at least 50% of the R&D project cost (at least 30% for R&D Centre projects).

 

  1. For an ITF platform project, a company can submit cash rebate application (Form A(I)) upon full payment of its pledged contributions to the project. 

     

  1. For an ITF collaborative project, the cash rebate is disbursed to a company in two phases.  The company can submit an application for the interim payment of cash rebate (Form A(I)) when the project expenditure has exceeded 50% of the project estimate.  It can submit an application for the final payment upon project completion.  The interim payment of cash rebate will normally be calculated on the basis of 50% of the project estimate, and the final payment will be based on the finalised project accounts.

     

  1. The following flowchart illustrates the two categories of cash rebate applications under ITF projects -

ITF Projects

 

Partnership projects

  1. Partnership projects refer to applied R&D projects which are funded entirely by companies and undertaken by the designated local public research institutions.  Information on the designated local public research institutions is set out in paragraph 21 below.  To be eligible for cash rebate under a Partnership project, a company is required to first pre-register its project proposal with the ITC (Form B(I)). The pre-registration should normally be made before the project commences and in any case within one month after the project commencement and provide the following details -

     


    1. company information (with a photocopy of the valid Business Registration (BR) Certificate);
    2. brief description of the purpose and the scope of the R&D project; and
    3. the designated research institution engaged by the company and the contact person.

       

    Project pre-registration should not be taken as prior approval of the ITC for cash rebate application. Modifications to the project as agreed between the company and the designated research institution do not require endorsement by ITC. Unlike ITF projects, ITC is not involved in the implementation and administration of Partnership projects. The designated research institution shall ensure the scope of the project is within the ambit of the Scheme and the implementation is in compliance with the relevant requirements in this Application Guide. For the purpose of processing an application under the Scheme, ITC will seek clarifications from the designated research institutions on details of the R&D projects where necessary.

     

  1. Applications for cash rebate (Form B(II)) should be supported by project reports from the designated local public research institutions to certify that -

    1. the scope of the applicant’s project is an applied R&D project within the ambit of the Scheme; and
    2. the financial payment by the company is in order.

    Cash rebate application form, Partnership project pre-registration form and a template for the interim or final project report by the relevant designated research institution are available at http://crs.itc.gov.hk.

     

  1. Similar to ITF projects, project expenditure which is essential and necessary for the conduct of a Partnership project (e.g. manpower, equipment and other direct costs such as materials and consumables) is eligible for cash rebate under the Scheme.  Some expenditure items (e.g. advertisement and publicity, training, entertainment and related expenses) are not eligible for cash rebate under the Scheme.

     

  1. Similar to ITF collaborative projects, the cash rebate for Partnership projects is disbursed to a company in two phases (see paragraph 7 above).  The following flowchart illustrates the two phases of payment of cash rebate -

Partnership projects

 

  1. The ITC reserves at all times the absolute right to require the applicant to submit additional documentary proof to substantiate its application. Applications without such proof will be rejected.

     

Disbursement of Cash Rebate

  1. Upon approval of application, the ITC will arrange to pay the cash rebate into the applicant’s company bank account as provided in the application form.  Applicants are required to notify the ITC of any change in their company name, bank account or address immediately to facilitate communications and disbursement of cash rebate.  

     

  2. The ITC reserves at all times the absolute right to review all applications and adjust the cash rebate amount as necessary.  In the event that there is overpayment due to error in calculation or assessment, applicants are required to refund the amount overpaid within 30 days upon notification.

 

Notification of Results

  1. Applications will be processed on a first-come-first-served basis.  The ITC aims to complete the processing of an application for cash rebate within 30 working days from the date of the receipt of the duly completed application accompanied by all necessary documentation. The ITC will acknowledge receipt of pre-registration of Partnership projects within 5 working days, with a copy to the relevant designated local public research institution.  Applicants should ensure that applications are submitted with the correct payment instructions and the necessary supporting documents.  Failure to do so may cause delay in processing the applications, or even resulting in rejection of applications.  Applicants should contact the R&D Cash Rebate Scheme Section of the ITC if they do not hear from or receive any notification from the ITC one month after submitting applications.

     

 

Deadline for Applications

  1. Applications of cash rebate for ITF projects should be submitted within 2 years after the acceptance of the final audited account of the projects by the ITC. Applications for cash rebate for Partnership projects should be submitted within 2 years after the completion of the project as certified by the relevant designated local public research institutions.

     

 

Amendment and Cancellation of Applications

  1. Applicants should ensure that all the information in the application form and the project report provided by the designated research institution is true and correct. If there is any change to the information contained in the application (including its supporting documents) after its submission, the applicant should inform the ITC in writing promptly and provide the supporting documents as appropriate.  Applicants are reminded that any amendments shall form an integral part of their applications.  Likewise, an applicant shall submit a written request to cancel its application.  

 

Handling of Information

  1. Information provided by companies in their applications will be kept in confidence.  It may however be disclosed to the concerned designated local public research institution, other Government departments or third parties in Hong Kong, if such disclosure is necessary for the purposes of processing the application or required by law, or if explicit consent to such disclosure is given by the applicant/data subject.

 

Important Notes

  1. It is the responsibility of the applicants and the designated research institutions to read carefully the Application Guide of the Scheme and complete the application forms and supporting documents required by the ITC fully and truthfully.  Inaccurate and incomplete information may affect the consideration and processing of the applications, and may result in deferral or rejection. Applicants should note that any misrepresentation or omission of information may lead to rejection of applications and/or full recovery of cash rebate already awarded, and possible court proceedings. Applicants are also reminded that it is an offence to obtain property/pecuniary advantage by deception. Any person who does so commits an offence and is liable to legal proceedings.

 

Enquiries

  1. Contact information of the designated local public research institutions are as follows -
  Institutions Contact Tel / Email

a)

Local universities –

 

(i)

The Chinese University of Hong Kong

Ms Erika Yuen
Business Development Officer
Knowledge Transfer Office
Tel: (852) 3943 1483, (852) 3942 0993
Email: erikayuen@cuhk.edu.hk

(ii)

City University of Hong Kong

Ms Pat Lam
Research Grants and Contracts Office
Tel: (852) 3442 6278
Email: pat.lam@cityu.edu.hk

(iii)

Hong Kong Baptist University

Dr Alfred Tan
Head
Knowledge Transfer Office
Tel: (852) 3411 2085
Email: alfredt@hkbu.edu.hk

(iv)

The Hong Kong Polytechnic University

Ms Kit Chan
PolyU Technology and Consultancy Company Limited
Tel: (852) 3400 2711
Email: ptec@polyu.edu.hk

(v)

The Hong Kong University of Science and Technology

Ms Candy Yung
HKUST R&D Corporation Ltd
Tel: (852) 2358 5833
Email: candyyung@ust.hk

(vi)

The University of Hong Kong

Mr Matchy Ma
Senior Business Development Manager
Technology Transfer Office
Tel: (852) 2299 0111
Email: info@tto.hku.hk

b)

R&D Centres under ITF -

 

(i)

Hong Kong Automotive Parts and Accessory Systems
R&D Centre

Mr C.H. Leung
Engineering Manager
Tel: (852) 2788 5311
Email: chleung@apas.hk

(ii)

Hong Kong R&D Centre for Logistics and Supply Chain Management Enabling Technologies

Mr Dee Ho
Program Operations Manager
Tel: (852) 2299 0538
Email: dho@lscm.hk

(iii)

Hong Kong Research Institute of Textiles and Apparel

Dr K.C. Ho
Director, Research and Development
Tel: (852) 2627 8188
Email: kcho@hkrita.com

(iv)

Nano and Advanced Materials Institute

Dr Vincent Li
Director of Business Development
Tel: (852) 3511 3451
Email: vincentli@nami.org.hk

(v)

Hong Kong Applied Science and Technology Research Institute

Ms Denise Wong
Financial Controller
Tel: (852) 3406 2838
Email: denisewong@astri.org

c)

Hong Kong Productivity Council

Mr. Alfonso Tam
Chief Manager, Council Secretariat
Tel: (852) 2788 5902
Email: alfonso@hkpc.org

d)

Vocational Training Council

Ms Stella Kwok
Senior Project Officer
Tel: (852) 2835 7464
Email: btychan@vtc.edu.hk

e)

Hong Kong Institute of Biotechnology

Prof Christopher H K Cheng
Managing Director
Tel: (852) 2603 5111, (852) 2603 5012
Email: enquiry@hkib.org.hk

  1. Enquiries on the Cash Rebate Scheme can be directed to -

     

    R&D Cash Rebate Scheme Section
    Innovation and Technology Commission
    21/F, West Wing, Central Government Offices,
    2 Tim Mei Avenue, Tamar, Hong Kong
    Tel no.: (852) 3655 5725
    Fax no.: (852) 2957 8726
    E-mail: crs-enquiry@itc.gov.hk
    Web page: http://crs.itc.gov.hk

 

Frequently Asked Questions (FAQs)

Q1

Can I submit cash rebate applications by fax or electronically?

A1 Applications forms should be duly signed by the company’s authorised officer and the hard copy should be submitted to the ITC by post or in person.  No application fee will be charged.
   
Q2  What kind of applied R&D work in Partnership projects will be eligible for cash rebate under the Scheme?
A2 Generally speaking, the projects should contain a significant amount of research content mainly in science and engineering disciplines.  Please refer to the “Eligibility” section of the Scheme’s Application Guide and contact the relevant designated local public research institutions for advice.
   
Q3 If the R&D project is undertaken by my company’s in-house research team or a private research house other than the designated local public research institutions, will my expenditure in such R&D work be eligible for cash rebate under the Scheme?
A3 Only in-house R&D work under projects funded under Small Entrepreneur Research Assistance Programme (SERAP) or Enterprise Support Scheme (ESS) of ITF are eligible for cash rebate. Partnership projects undertaken by the designated local public research institutions are also eligible for cash rebate.
   
Q4 Are non-local companies eligible for cash rebate under the Scheme (e.g. Mainland companies)?
A4 Yes.  Both local and non-local private companies can apply for cash rebate if they are industry sponsors/ partners in individual ITF projects or by partnering with the designated local public research institutions to undertake applied R&D projects on their behalf.  They must meet the requirements of the Scheme. Companies outside Hong Kong shall provide a bank account that accepts HK dollar/major foreign currencies.
   
Q5 Will the Scheme allow part of the R&D work to be conducted overseas?
A5 Yes.  Under the prevailing ITF funding guidelines, we allow up to 50% of the R&D work to be conducted (and relevant expenditure incurred) in the Mainland, or undertaken by overseas universities or research institutes which have entered into technology collaboration agreements with the Hong Kong SAR Government or local universities/R&D Centres.   The same rule applies to Partnership projects.
   
Q6 How long will it take for the cash rebate to be disbursed?
A6 We expect to disburse the cash rebate normally within 30 working days after receipt of the duly completed application accompanied by all necessary supporting documents.  If there are complications in individual cases, the ITC will contact the applicants and the relevant designated local public research institutions where appropriate.
   
Q7 Can I apply for the cash rebate in one go upfront instead of two phases in an ITF collaborative project or a Partnership project?
A7  We will not disburse full payment of the cash rebate upfront for these projects as the R&D project expenditure will only be finalised after project completion.  From our experience, the final project cost may be lower than the original cost estimate.
   
Q8 Can I choose to receive the cash rebate in other bank accounts not under my company name or in the form of cash payment under the Scheme?
A8  We will normally disburse the cash rebate to bank accounts under the name of the applicant company.  We will not arrange for cash payment under the Scheme.
   
Q9 Will in-kind/non-cash sponsorship under ITF projects be accepted for calculating the amount of cash rebate under the Scheme?
A9 In-kind/non-cash sponsorship, such as research equipment and consumables which are essential and necessary for the conduct of ITF projects will be eligible for cash rebate under the Scheme.  The same rule applies to Partnership projects.
   
Q10 How many cash rebate applications can be submitted by a company each year?  What is the minimum and maximum amount of cash rebate to be disbursed in an application?
A10  We do not set any restriction on the amount of rebate that may be received by a company nor the number of applications that it may submit in a year.
   
Q11 Is there is any deadline for submitting the application on cash rebate?
A11 Application should be submitted within 2 years after the completion of the relevant R&D projects.
   
Q12 If there are minor changes to the project scope of a Partnership project after pre-registration, do I need to inform the ITC?
A12 No approval for the change of project scope is required.  To facilitate communication and subsequent processing of applications, it would be helpful for the company to inform the ITC of such changes which have been agreed with the designated local public research institution undertaking the projects.
   
Q13 For a Partnership project, can the applicant and the designated research institution submit the application and project report to ITC separately?
A13 The project report forms part of the application. The applicant should obtain the report from the designated research institution, confirm it is accurate and in order, and submit it together with the application form. Application form without the support of project report will not be processed.
   

Innovation and Technology Commission
February 2016