R&D Tax Reliefs

Qualifying project work can be present in non-R&D intensive sectors, and we can help you to understand if what you are doing qualifies. If you employ or subcontract to scientists, technologists, engineers or developers in all thing’s computer science, then it’s worth exploring the potential application of this tax relief.

The R&D tax credit is a forward-looking tax relief that provides additional cash resources to businesses developing new or improved products, processes, materials, devices or services. 

Cash resources are made available through a reduction in a company’s corporation tax bill (R&D Tax Relief) or through a payment of a cash credit (R&D Tax Credits). 

The form of the relief depends on whether a company made taxable profits or a tax loss during the year the qualifying project work was carried out. 

It’s possible both forms of cash generation will be in point for the same claim period in certain circumstances. We can help you understand this.

There are two elements to an R&D claim: 

• Qualifying the claim – demonstrating eligibility criteria have been met. 
• Quantifying the claim – linking allowable expenditure to eligible work. 

If your company is eligible for this relief, it is the allowable expenditure that ultimately determines the value of the cash/tax benefit received.

Ideally, you will be thinking about whether your work qualifies as you go along. If you haven’t claimed before or in a while you may need to tell HMRC of your intention to make a claim within six months of the end of your accounting period. 

The standard time limit a company has to make an R&D tax relief claim is two years from the end of the accounting period in which the qualifying work took place. For example, if your accounting period end date is 31 December 2024, you have until 31 December 2026 to make a claim. 

Note that qualifying work can span more than one accounting period and so you could be looking at making more than one claim, for successive accounting periods.