Tax Credit – R&D Tax Relief

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    Our last 5 years Corporation Tax was refunded, thanks!

Cresco can advise you on claiming on R&D tax credits.

An overview. R&D Relief is a Corporation Tax relief that may reduce your company or organisation’s tax bill, as a SME, you may be able to choose to receive a tax credit instead, by way of a cash sum paid by HM Revenue and Customs (HMRC). Relief is given as a taxable credit on the amount of qualifying R&D expenditure. In the Small and Medium-sized Enterprise Scheme…

From 1 April 2015, the tax relief on allowable R&D costs is 230% – 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 £130 on top of the £100 spent.

Is my company a SME?

To qualify as R&D an activity must meet the definitions set out by the DTI and must contribute directly to seeking the advance in science or technology or must be a qualifying indirect activity. If your company and the project qualify then you can claim tax relief on revenue expenditure (day-to-day running of the business), but not capital expenditure on assets). Qualifying revenue expenditure could be, for example:

  • Employee costs
  • Staff providers
  • Materials
  • Utilities
  • Software
  • Subcontracted R&D expenditure.