What is
Research & Development Tax Credits?
A government incentive designed to reward UK companies for investing in innovation
Chartered Certified Accountants | R+D Specialists
Research & Development Tax Credits?
What is Research & Development Tax Credits?
For tax purposes, R&D takes place when a project seeks to achieve and advance overall knowledge or capability in a field of science or technology. Qualifying businesses can claim either a cash credit or corporation tax deduction to compensate for up to 130% of the cost of their research and development. You can also receive the benefit even if your business is making a loss!
R&D tax credits are a government reward for your work in advancing science or technology.
What qualifies?
R&D can take place in any sector and the HMRC criteria are purposefully broad. It doesn’t just include “white coat” scientific research, but also any design or engineering that involves overcoming difficult technological problems.
Your project may research or develop a new process, product or service or improve on an existing one. It is important to note that pure product development itself does not qualify.
To get R&D relief you need to explain how a 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
- It must incorporate an advance in science or technology.
These R & D costs qualify
- Direct and external staff
- Subcontracted R&D
- Consumables
- Software
- Trials
- Prototyping
- Independent research costs
These costs do not qualify
- Capital expenditure
- Production and distribution of goods and services
- Cost of land
- Payments for the use and creation of patents and trademarks
We’d love to find out more about your
business and discuss how we might be able
to help you claim R&D Tax Credits.
Client quotes:
“Professional yet down to earth, friendly and helpful! They gave us a sense of security knowing that they were looking after our bookkeeping, accounting and tax requirements“
“The best firm of accountants and business advisers I have ever encountered”
“Anyone who wants an accountant to make a positive difference to their business should work”