SERVICES

R&D Tax Relief

Introduced by the British Government in 2000, Research & Development Tax Relief is intended to incentivise businesses to invest in innovation, allowing you to claim a proportion of the money you have invested to improve your industry. Small and Medium-sized Enterprises (SMEs) can claim up to 33% of their incurred costs while performing R&D activities. 

What Qualifies?

Quite often when we first speak with companies, their interpretation for research and development activity is different to that of HMRC. R&D activity can be undertaken in almost any industry and can include trying to make something cheaper, quicker, smaller or larger, stronger etc. It can even include duplicating a product, process, service or device, as long as it’s in an appreciably improved way.

According to HMRC, a company is undertaking R&D when they are overcoming technological uncertainties, through achieving an advance in technology, and which isn’t readily deducible by a competent professional. R&D is still deemed to have taken place whether or not the project is actually successful – it’s the ‘seeking’ that counts.

WHy?

Benefits of R&D Tax relief

Cash Injection

Economic Growth

Boost UK Innovation

Job Creation

Rewards R&D Departments

Eligible R&D Expenditure

Employee Costs

This includes salaries, National Insurance contributions, pension, and bonuses.

Material Costs

Materials used during prototyping or tests during your development projects can be included.

Utilities

A proportion of your power and water costs can be included within your R&D Tax Relief submission.

Software Licences

Licence fees you have had to pay for to undertake your innovation projects can be included, as well as other software costs.

Sub-Contractors

If part of your innovation projects have required outsourced workers, typically you can claim 65% of those costs. This is normally for SME businesses only.

EPW's

Have you required agency staff to assist with your projects? Similarly to employees, their costs can be included within your submission.

FAQs

This depends on your company’s size. SMEs can claim up to 33% of their qualifying costs back as their benefit. If you are a large company the amount is 8.8% of your qualifying costs.

The research and development tax scheme isn’t available to every business, only those that are eligible for corporation tax (limited businesses). 

Claims can include any qualifying costs which have been made in the last two accounting years of your company. For example, a business with a financial year end of December 2024 can claim costs from January 1st 2023 onwards.

Submissions can be prepared quickly once we have secured all the necessary information. We usually have your report produced within a week. HMRC advise that they will make payment to you within 28 days, however at certain times of the year this can change. 

For each R&D submission there is nothing to pay us upfront. We charge a contingent fee based on the success of your benefit being paid by HMRC. Our fee also includes a full defence in the event HMRC has any questions that they would like to ask.

R&D tax relief can be paid in three different ways: a cash credit, a corporation tax rebate or an expenditure that you may take forward against future profits. In certain circumstances the choice is yours.