R&D Tax Credits and Relief
If your business is involved in innovative projects in science and technology, you might be eligible to claim Research and Development (R&D) tax credits. Even if your project is ultimately unsuccessful, you could claim Corporation Tax relief to offset some of the costs of your research.
Our specialist IT and technology tax advisors are experienced in supporting clients through the application process, and successfully claiming R&D tax relief for a variety of clients in the science, IT and technology sectors.
SME R&D Relief
If your small or medium sized business invests money in research projects, you could claim SME R&D relief. Depending on whether your company is profit or loss making, you might be eligible to deduct an extra 130% of your qualifying costs from your yearly profit, on top of the normal 100% deduction, or you could claim an R&D tax credit worth up to 14.5% of the surrenderable loss. Our experienced advisors will help you through the application process, defining your eligibility and identifying the relevant expenditure for relief.
Research and Development Expenditure Credit (RDEC)
RDEC is the tax relief that replaced the large company scheme in April 2016, and allows large corporations, or small and medium sized enterprises who've been subcontracted to do R&D work by a large company, to claim a credit of 11% of all qualifying research and development expenditure. Depending on whether your company is profit or loss making the credit may be used to discharge the liability or result in a cash payment. Our tax advisors will support you through the process of applying for RDEC and help you define how your claim meets the government's definition of R&D.
In both cases, the costs you can claim against include:
- employee costs (salaries, wages, Class 1 NICs, pension fund contributions)
- subcontractor costs
- consumable items
For a list of projects that count as research and development, visit the Government's website.