Corporation Tax: Research and Development (R&D) Relief

R&D Tax Credits

The UK government have introduced R&D tax credits as a way to encourage greater R&D spending and to promote investment in innovation.  Using R&D Tax Relief can make using University expertise to carry out a research project, more affordable.

Research and development (R&D) relief is tax relief for all sizes of companies and can either reduce a company's tax bill or, for some small or medium sized companies, provide a cash sum.

The SME scheme has a higher rates of relief. Tax relief on allowable R&D costs is 225% - that is, for each £100 of qualifying costs, your company or organisation could have the income on which Corporation Tax is paid reduced by an additional £125 on top of the £100 spent. It also includes a payable credit in some circumstances.

The large company scheme is currently 125% rate of enhanced deduction to 31 March 2008 and a 130% rate of enhanced deduction thereafter.

In order to qualify for this benefit your company or organisation can only claim for R&D Relief if an R&D project seeks to achieve an advance in overall knowledge or capability in a field of science or technology through the resolution of scientific or technological uncertainty - and not simply an advance in its own state of knowledge or capability.

Once you've checked your eligibility, contact us to discuss how we can help you deliver on your R&D needs.

 

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