What is R&D tax relief?
Did you know that companies are claiming up to 33% of their research and development expenditure back as a tax credit?
Research and Development (R&D) tax relief is a valuable way that the UK Government aims to encourage growth and reward companies investing in innovation. The money claimed back can be used to financially support your business and help it growth.
The key is uncertainty and advancement
The UK Government’s Research and Development Tax Relief scheme is remarkably inclusive and companies in any sector can be eligible. Both profitable and loss making companies can benefit from an R&D tax relief claim. A loss-making company can surrender the losses incurred in carrying out R&D for a repayable cash credit. You can claim R&D tax credits retrospectively for up to two years after the accounting year-end date.
What qualifies as innovation in the eyes of HMRC?
For tax purposes, R&D takes place when you are creating something that will advance the overall knowledge or capability in a field of science and technology. In simple terms, if you are solving industry problems, creating new software, materials or aiming for a particular outcome but are unsure you have all the answers to get there because it’s uncommon and goes beyond established methodologies, you have a potential R&D claim.