- Scheme Overview
R&D Tax Credit Scheme
Main Features of Britain’s R&D Tax Relief & Credit scheme
- A loss-making SME can claim a tax credit of up to 24.5% of qualifying R&D expenditure incurred by them during an accounting period
- A profit-making SME can claim a tax relief enhancement of up to 175% of qualifying R&D expenditure and a Large Company can claim an enhancement of up to 130%
- The scheme is initially available to offset corporation tax payable by a company in the year that expenditure was incurred. Relief can also be applied on a group basis
- Qualifying relief can be carried forward indefinitely. It may also be carried back and offset against corporation tax paid by the company in the previous year
- The R&D activities must be carried out by a company in the European Economic Area (EEA)
- Qualifying expenditure must be net of any grants which relate to the R&D activities being carried out
- Companies have 24 months from the end of their accounting period to file a claim
Our objective: To identify all your innovative projects with clarity, efficiency and precision, allowing you to maximise your R&D Tax Credit claim.
ELIGIBLE ACTIVITIES
The definition of R&D, for tax purposes, is much wider than traditional activities taking place in R&D centres and laboratories. R&D may occur in a range of industry sectors such as Oil and Gas, Engineering, Food, Automotive, Building & Construction, Mining, Utilities, Generic Pharmaceuticals, Biotechnology, General Manufacturing, IT/Software, Financial Services and many more...
Eligible R&D Activities
Determining eligible R&D activities is where we maximise our value to you.
R&D activities must either:
- Be systematic, investigative or experimental activities in a field of science or technology, or
- Seek to achieve scientific or technological advancement, or
- Involve the resolution of scientific or technological uncertainty
HMRC defines R&D as one or more of the following:
- Basic research: “experimental or theoretical work undertaken primarily to acquire new scientific or technical knowledge without a specific practical application in view”
- Applied research: “work undertaken in order to gain scientific or technical knowledge and directed towards a specific practical application”. Applied research is usually undertaken either to determine possible uses for the findings of basic research or to determine new methods or ways of creating practical applications
- Experimental development: "work undertaken which draws on scientific or technical knowledge or practical experience for the purpose of achieving technological advancement and which is directed at producing new, or improving existing, materials, products, devices, processes, systems or services including incremental improvements thereto"
>> Examples of eligible activities in various industries
QUALIFYING EXPENDITURE
Qualifying expenditure includes expenditure incurred directly in the carrying out of R&D activities
