What is Research and Development (R&D) Tax Relief?

Full Definition

Research and Development Tax Relief reduces the Corporation Tax bill of companies that carry out qualifying R&D seeking an advance in science or technology while resolving genuine uncertainty. Under the merged scheme that now applies to most claimants, companies receive an expenditure credit on qualifying costs such as staff, subcontractors, software, consumables and certain data and cloud costs. The credit is taxable and broadly gives net relief shaped by the Corporation Tax rate, which is 19% up to GBP 50,000 of profit and 25% from GBP 250,000. Loss-making and R&D-intensive small companies may access enhanced support routes. Claims require detailed records, a costing methodology and, increasingly, advance notification and additional information forms submitted to HMRC. Rules have changed frequently and are heavily scrutinised, so confirm eligibility and current rates on gov.uk and keep robust evidence.

Related Calculators

See Also