Could you claim for R&D Tax Relief?

Contributor:
Xeinadin Group

Date:

Category:

Share this article:

R&D tax relief has been available since 2000, and has undergone many changes in its relatively short lifespan. It is available to corporates but not individuals.

What is R&D?

Very briefly, R&D for tax purposes takes place when a project seeks to achieve an advance in science or technology. It can also take place when a company is working to resolve scientific or technological uncertainty, which is where a business attempts to solve a problem where no solution is evident.

In essence, if a business invests in innovation and develops anything that helps the business gain a competitive advantage in a new way, the business is likely to have a very good starting point from which to make an R&D claim.

Hallidays recently supported a business to secure a refund in their corporation tax of £52k for R&D relief. With a clear understanding of how to make a claim for R&D expenditure some businesses are able to reduce their corporation tax year-on-year.

Recent Developments:

The Autumn 2017 budget brought about several changes to the R&D regime, the principal ones being:

  1. Research & Development Expenditure Credit (RDEC):

From 1st January 2018, there has been a 1% increase (from 11% to 12%) in the RDEC tax credit a large company (and in some cases SMEs) can claim that incurs R&D expenditure.

  1. Advance Assurance:

HMRC will run a pilot scheme for a new Advanced Clearance service for R&D expenditure credit claims, which will provide a pre-filing agreement for three years.

  1. Awareness:

HMRC are devising a series of programmes to increase awareness of eligibility for R&D tax credits amongst the SME sector, in response to low levels of R&D claims.

Conclusion:

Although the 1% increase in the RDEC rate will principally benefit large corporates, all businesses should closely monitor their expenditure to see if they can potentially qualify for R&D tax relief. There are strict time limits within which claims can be submitted, and if these time limits are missed valuable tax reliefs could be lost.

How Hallidays can help

If you would like help to make a claim for R&D tax relief please read our success story or contact our tax team on 0161 476 8276 or [email protected] for expert support. 

Disclaimer:

The information contained herein is of a general nature and is not intended to be received as formal professional advice. Whilst we endeavour to provide accurate information, there can be no guarantee that the information is accurate as of the date it is received, or that it will continue to be accurate in the future, due to legislative changes. It is therefore important that before you act upon any information contained herein you seek appropriate professional advice to take account of your exact circumstances.

This website uses cookies

With these cookies, we and third parties can collect information about you and your internet behaviour, both within and outside our website. Based on this, we and third parties adjust the website, our communication, and advertisements to your interests and profile. You can read more information in our cookie statement.

If you opt for acceptance, we will place all cookies. If you opt for rejection, we will only place functional and analytical cookies. You can adjust your preferences at a later time.

Accept Reject More options

This website uses cookies

With these cookies, we and third parties can collect information about you and your internet behaviour, both within and outside our website. Based on this, we and third parties adjust the website, our communication, and advertisements to your interests and profile. You can read more information in our cookie statement.

Functional cookies
Arrow down

Functional cookies are essential for the proper functioning of our website. They allow us to enable basic functions such as page navigation and access to secure areas. These cookies do not collect personal information and cannot be disabled.

Analytical cookies
Arrow down

Analytical cookies help us gain insight into how visitors use our website. We collect anonymised data about page interactions and navigation, enabling us to continuously improve our site.

Marketing cookies
Arrow down

Marketing cookies are used to track visitors when they visit different websites. The goal is to display relevant advertisements to the individual user. By allowing these cookies, you help us show you relevant content and offers.

Accept all Save