Many business owners wrongly think R&D tax relief is reserved for companies with labs full of scientists in white coats. Because of this, a vast number of businesses in the UK assume they are ineligible to receive tax relief. The reality is any company subject to Corporation Tax that can demonstrate it is attempting to overcome a technological or scientific uncertainty qualifies.
We work with a vast range of businesses all over the UK ranging from architects, vets and manufacturers to engineers, exhibition designers, digital agencies and breweries. The relief really is open to all industries.
Currently, there are two different schemes available for those who meet HMRCs requirements: the Small or Medium-sized Enterprise (SME) Scheme and Research and Development Expenditure Credits (RDEC).
SMEs are companies employing less than 500 staff with revenues less than €100m or gross assets that don’t exceed €86m (companies exceeding this are still able to claim under the RDEC scheme).
The RDEC scheme allows large companies to claim R&D tax credits for work carried out on or after 1 April 2013, though the rate of relief is much lower than that available to SMEs. The net cash benefit is currently 8.8% of qualifiable expenditure. RDEC replaces the older Large Company scheme as of April 2016.