R&D Tax Credits

Is your company involved with innovation?

If so, you may be eligible for R&D Tax Credits. They reward innovation and have the power to transform your business.

You could potentially claim up to an extra £1.30 in tax relief for every pound you spend on qualifying projects.

Research and Development (R&D) Tax Credits are a tax incentive designed to encourage UK companies to invest in innovation in science and technology. You may be able to claim relief from Corporation tax if your project meets the R & D criteria.

They are a valuable source of cash to invest in accelerating R&D, hiring new staff and ultimately growing.

If your company is a small or medium enterprise (SMEs), R&D Tax Credit is a Corporation Tax (CT) tax relief that can reduce your company’s Corporation Tax liability or result in a payable tax credit.

If your business is defined as a large company, the incentive is called Research and Development Expenditure Credit (RDEC), which is an above the line credit. It can either reduce your tax bill or allow you to claim payable cash credits.

How can R&D tax credits work for my business?

If your company is developing new products, processes or services, or enhancing existing ones, it may be eligible for R&D Tax Relief.

Your business can make an R&D Tax Credit claim to receive either a cash payment and/or Corporation Tax reduction if it is spending money on innovation.

The first time your business makes a claim it can typically claim R&D Tax Relief for the last two completed accounting periods.

Is my business eligible for R&D Tax Credits?

To get R&D tax relief 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.

Your project may research or develop a new process, product or service or improve on an existing one.

The scope for identifying R&D is huge.  The R&D tax relief schemes are designed to be applicable across any sector.

The definition of R&D for tax purposes is very broad and it’s quite likely that some of your business projects could qualify.

The essential qualifying elements are:

• Your business must be a UK registered company liable for Corporation Tax
• Has carried out qualifying R&D activities
• Has spent money on the R&D activities

These are just some of the many industry sectors that have received R&D Tax Credits

  • Computer hardware, software and electronics
  • Construction
  • Data centre technologies
  • Defence
  • Electrical insulation and switchgear technologies
  • Engineering
  • Financial services
  • Food and drink
  • Lifting equipment
  • Manufacturing
  • Materials handling
  • Medical devices and dental equipment
  • Oil, gas, wind and solar power
  • Pharmaceuticals and biotech
  • Printing technologies
  • Traffic control devices
  • Waste water treatment

Find out if your business qualifies for R&D Tax Credits

Companies of any size can claim R&D Tax Credits although small and medium-sized (SMEs) companies tend to get a better deal than those on the large company tax relief scheme.

Many businesses are missing out on the thousands of pounds they could claim back in R&D Tax Credits from HMRC, largely through a lack of awareness.

Here at ASfB we can navigate the complex rules and guidelines that govern this niche area of tax.  Our specialist Chartered Accountants will work with you to identify any activity qualifying for relief and maximise your R&D tax claims.

Don’t miss out on the opportunity, find out how we can help.