R&D Tax Relief

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Millions of pounds each year go unclaimed through R&D tax relief, causing thousands of businesses to miss out on money that could be reinvested in their latest projects and innovations.

What is R&D tax relief?

Research and development (R&D) tax credits are intended to reward companies in the UK that invest in innovation.

However, this valuable tax relief remains underutilised, despite allowing businesses to invest in R&D, hire new talent and grow.

How do R&D tax credits function?

If you have developed new products, processes or services or enhanced existing ones you may be eligible for this relief.

Claiming R&D tax credits against these developments provides either a cash payment or a reduction to Corporation Tax.

Many preconceptions surround this relief and who may be eligible but many are unfounded and this initiative is open to businesses in almost every sector, as long as they can prove they have made a suitable advancement in their field.

Your R&D project doesn’t even have to have been successful to qualify and you can also include work undertaken for a client.

Who is eligible for R&D tax credits?

To benefit from R&D tax credits, you must:

  • Be a UK limited company that is subject to Corporation Tax.
  • Have completed qualifying research and development activities.
  • Have spent money on an eligible project.
  • Have incurred qualifying expenditure.

Depending on whether you are a small to medium-sized enterprise (SME) or a large company, the scheme that you apply for may differ.

However, through these schemes:

  • SMEs can claim up to 33p for every £1 spent on qualifying R&D activities.
  • Large companies can claim up to 10.5p for every £1 spent on qualifying R&D activities.

If you would like to discuss a claim for R&D tax relief, please speak to our team.