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What are R&D Tax Credits? | Ultimate Guide

Updated: Jun 22, 2021

What are R&D Tax credits?

Research and development (R&D) tax credits are a government incentive designed to reward UK companies for investing in innovation. They are a valuable source of cash for businesses to invest in accelerating their R&D, hiring new staff and ultimately growing.


Who is eligible?

  • UK based companies liable to pay corporation tax who:

  • Are seeking to overcome uncertainties within an industry

  • Are improving processes, services, materials, devices

  • Work requires trial and error to get to the end result

  • Have invested in failed projects or developed products that have never launched

  • Employ technical staff

  • Projects involve design and/or implementation

What can be claimed?

  1. Staff costs (including employers pension and employers NI, but not benefits in kind)

  2. Externally provided workers, e.g. agency staff (up to 65%)

  3. Materials/consumables used directly in the R&D process

  4. Power, water, fuel used directly in the R&D process

  5. Computer software

  6. Subcontracted R&D costs can be claimed (up 65%)

  7. Wastage

How companies are categorised?


SME’s

  • Employ less than 500 staff.

  • Have either an annual turnover less than 100m euros or a balance sheet under 86m euros.

  • SMEs can get back up to 33% of the amount they’ve spent on qualifying R&D.


RDEC (Research & Development Expenditure Credit)

  • Employ over 500 staff.

  • Have turnover over 100m euros and more than 86m euros on the balance sheet.

  • Large companies claim at around 10% and is shown as income on the balance sheet.


Advantages of R&D Tax Credits?


Receive a cash refund, lowered corporation tax bill or a combination of the two.


Combine these additional funds with either Asset Finance or Invoice Finance to create a dynamic financial solution for your business.


The Process


From initial inquiry to successful completion can be completed within 8-12 weeks. We work with specialist advisors who understand your industry and have experience in successful claims for businesses from a wide variety of sectors.


No Win No Fee


Our Advisers work on a No Win No Fee basis, get in touch to arrange a review, and within 8-12 weeks you could have an important cash injection into your business.


Contact us on 01392 241669

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