R&D Tax Relief - Should you be claiming? - FranklyConsult.com

R&D Tax Relief – Should you be claiming?

R&D Tax Relief – Should you be claiming?

What is R&D Tax Relief

R&D stands for Research and Development. Why would you get tax relief on this? Well, if you’ve invested in a project that has helped develop your business, HMRC state that you may be eligible for a tax rebate.

How is this received?

It is a corporation tax relief. Therefore, it usually reduces your company’s tax bill. However, if you are not making any profit, then it will be received in the form of a cash rebate from HMRC.

What qualifies as R&D?

Simply put, any project that achieves an advance in overall knowledge or capability in a field of science or technology would be eligible. Additionally, you can claim on any expenses attributed to the project, such as extra resources or employees on the project. It is important to know however, that the project does not have to be successful for it to be eligible.

Examples of R&D projects:

  • Creation of software for more efficiency within the business
  • Development of an advanced CMS
  • Building of hardware to operate a key part of the business
  • Creation of a platform to make better use of data
  • Development of software to ensure compliance in a heavily regulated industry

If you are still unsure if your project qualifies, please drop us a line and we can help you check.

How much is the relief?

The relief is up to 33.35% of your R&D spend. This will be a cash repayment from HMRC if your business is making a loss (as discussed earlier) or a reduction of your corporation tax bill (if you are making a profit) of 26% of your R&D spend.

When should I claim for R&D tax relief?

In your corporation tax return each year you will make your claim for R&D relief. The claim must but be submitted within 2 years of the relevant year end.

Visit here for more information over on the HMRC page.

If you have any questions then please do contact us.

Thanks and best wishes



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