Research & Development

R&D Tax Credits

What are R&D Tax Credits?

Research and development (R&D) Tax Credits are a government incentive to encourage and support innovation within UK businesses.

R&D Tax Credits enable businesses who incur costs through the development of products, processes, software or services to recover a corporation tax deduction or cash payment from HMRC, up to 33.5%.

You make a claim going back two accounting periods.

That’s potentially a lot of money.

If your business is currently investing in R&D but not taking advantage of tax credits, let’s find out if you might be eligible.

Am I eligible for R&D Tax Credits?

First off, in order to meet the requirements of the scheme you have to have undertaken qualifying research and development activities in science or technology when either:

Creating new products, processes or services

Changing or modifying an existing product or service

The project must relate to your company’s trade – either an existing one, or one that you intend to start up based on the results of the R&D.

You need to be able to explain how this project:

  • Looked for an advance in science and technology
  • Had to overcome uncertainty
  • Tried to overcome this uncertainty
  • Could not be easily worked out by a professional in the field

What scheme applies to me?

There are two different schemes for R&D tax relief depending on the size of your company and whether the project has been subcontracted to you or not.

These are:

1) The SME R&D Tax Credits scheme

2) The Large company scheme; also known as RDEC (Research and Development Expenditure Credit).

What are the benefits of claiming R&D Tax Credits?

 R&D tax credits can be hugely beneficial to businesses working to develop new products, processes and services.

This non-repayable cash injection helps fund important R&D projects and boosts innovation across the UK.

I think we’re eligible. What next?

If, by reading the above, you feel you may qualify for an R&D Tax Credit, let’s have a chat.

We can confirm your eligibility and work with you to establish the eligible expenditure, prepare the necessary report and reclaim the tax you deserve.