Impact assessment

Research and Development Tax Relief - The Merged Scheme: R&D Expenditure Credit (RDEC)

Published 18 September 2025

Project objectives

The Research and Development (R&D) tax relief review was announced at Spring Budget 21. The objective was to ensure that the UK remained a competitive location for cutting edge research, the reliefs continued to be fit for purpose and taxpayer money was effectively targeted.

Providing a reformed approach to Research and Development (R&D) reliefs would greatly improve the targeting of the reliefs and should help support R&D) expenditure.

Merging the previous small or medium-sized enterprises (SMEs) and Research and Development Expenditure Credit (RDEC) schemes simplifies and improves the system, helping to drive innovation in the UK.

This includes boosting certainty by moving to an above the line mechanism and a single set of qualifying rules for most R&D businesses, adopting an approach to contracted out R&D which allows more large companies to claim for the costs of the work contracted out, while also removing the complex rules around qualifying bodies. 

In a further simplification, the rules relating to subsidised expenditure in the SME scheme were not carried forward into the new merged scheme, meaning that where a company receives a grant covering part of the costs of their R&D (for example), the amount of relief available will not be reduced.

Customer groups affected

The customer groups that will be impacted by the change are:

• companies
• agents
• payroll software providers

What customers will need to do

As with previous R&D relief claims; customer(s) have been able to claim relief by submitting their Corporation Tax Self Assessment (CTSA) return together with required additional information via supplementary pages and online form. The project has amended the additional online form(s) and CT600(2025) questions to match the new Research & Development (R&D) scheme(s)

How customers will access this service

CT600 is submitted by third party software providers. Paper and accessible formats are available on GOV.UK.

Online forms are available on GOV.UK and will meet accessibility standards. The online forms are not available to download.

Digitally excluded customers would need to contact the Corporation Tax (CT) Helpline where HMRC staff will advise the customer on how to submit their information.

When customers need to do this

Merger of the Research and Development (R&D) reliefs applies to companies with accounting periods beginning on or after 1 April 2024.

Assessing the impact

We assessed the equality impacts on all the protected characteristic groups in line with the Equality Act and Public Sector Equality Duty and section 75 of the Northern Ireland Act:

• race
• gender reassignment
• sex
• sexual orientation
• pregnancy and maternity
• marriage and civil partnership
• people with dependents and those without
• political opinion (for Northern Ireland only)

There is no evidence to suggest any specific impacts on those customers within any of the protected characteristic groups listed above. Online guidance will be available. Extra support will be provided as required.

The following equality impacts were identified:

Disability:

Impact on customers

Some customers may require accessible formats or use screen readers as a result of their disability.

Some customers may also be digitally excluded as a result of their disability.

Proposed mitigation:

Digitally excluded customers will be able to contact the Corporation Tax (CT) helpline, where call handlers will support them.

All our digital journeys meet accessibility WCAG 2.2 guidelines. It is not a different journey but built into the journeys we deliver.  

Age:

Impact on customers:

There may be varying levels of digital capability and confidence across differing age groups, with some groups being more likely to contact HMRC for further support.

Proposed mitigation:

Customers can contact HMRC using the contact details provided on GOV.UK, for further support in completing online forms or using HMRC online services.

Customers also have the option of appointing someone else to deal with HMRC on their behalf, such as an agent. Once registered, correspondence will be issued to the registered third party.

Religion or belief

Impact on customers

Some customers maybe digitally excluded on religious grounds.

Proposed mitigation:

Digitally excluded customers will be able to contact the Corporation Tax (CT) helpline, were call handlers will support them.

People who use different languages (Including Welsh Language and British Sign Language)

Impact on customers

There may be some impacts for customers whose first languages are not English or Welsh.

Proposed mitigation:

Guidance has also been published in Welsh on GOV.UK. Where customers request additional assistance in Welsh, callers will be referred to HMRC’s Welsh Language unit.

HMRC offers a Welsh language service to customers, where proportionate, in line with HMRC protocol. Forms on GOV.UK can be requested in Welsh.

For any customers whose first language is not English, alternative arrangements can be made for friends and family to interpret or speak on a customer’s behalf. Currently Research and Development G-forms and communications can be provided in Welsh and any letters, online services or contact with the customer can be provided in Welsh in line with HMRC’s legal commitment under the 1993 Welsh Language Act.              

Guidance published on GOV.UK complies with Government Digital  Service (GDS) standards and GOV.UK style guides.

Opportunities to promote equalities

We have considered opportunities to promote equalities and good relations between people in each of the protected characteristic groups and those outside of that group.

No such opportunities have been identified with this change.

A full Equality Impact Assessment is not recommended.