Research and Development (R&D) tax relief
Information on the different types of relief for companies that work on R&D, how to find out if you can claim and what to do before you make a claim.
Research and Development (R&D) tax reliefs support UK companies working on innovative projects in science and technology.
Before submitting a claim you should consider if your activity will be eligible for R&D tax reliefs.
It is very unlikely you will be eligible if your activity:
- will not be recognised as a scientific or technological innovation
- has already been conducted or is currently being conducted elsewhere
The types of claims which are rarely eligible for R&D tax reliefs include those made by:
- care homes
- childcare providers
- personal trainers
- wholesalers and retailers
- pubs
- restaurants
You cannot claim if the advance is in:
- the arts
- humanities
- social sciences, including economics
You may have to pay a penalty if you make an ineligible claim.
If you think your company might be eligible for R&D tax relief read the following guidance.
Find out if you can make a claim
Find out if your work qualifies as R&D and the different reliefs your company could claim.
Tell HMRC before you make a claim
For accounting periods beginning on or after 1 April 2023 you may need to tell us if you plan to claim R&D tax relief or expenditure credit.
Submit detailed information before you make a claim
From 8 August 2023 you must complete and submit an additional information form to HMRC to support all your claims for R&D tax relief or expenditure credit.
R&D tax relief for small and medium-sized enterprises (SMEs)
SME R&D tax relief allows companies to deduct an extra 86% of their qualifying costs, in addition to the normal 100% deduction from their yearly profit.
You can also choose to claim a payable credit if your company is making a loss.
If you’ve not claimed tax relief before on R&D projects, you may be able to apply for advance assurance.
R&D expenditure credit (RDEC)
If you’re a large company, you can claim expenditure credit on your qualifying expenditure costs.
You can also claim if you’re a SME and you cannot claim SME R&D tax relief.
Merged scheme R&D expenditure credit (RDEC) and enhanced R&D intensive support (ERIS)
The merged scheme R&D expenditure credit (RDEC) and enhanced R&D intensive support (ERIS) replace the old RDEC and small and medium-sized enterprise (SME) schemes for accounting periods beginning on or after 1 April 2024. The expenditure rules for both are the same, but the calculation is different.
Last updated 17 January 2024 + show all updates
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New guidance on if your work qualifies as Research and Development for tax purposes, including examples, added to the ‘Find out if you can make a claim’ section.
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The information about when you must submit an additional information form has been updated from 1 August 2023 to 8 August 2023.
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A link to a Welsh version of the page has been added.
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First published.