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HMRC internal manual

Corporate Intangibles Research and Development Manual

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HM Revenue & Customs
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R&D tax relief: legislative structure and time line: time line for changes

Chronological list of changes

With two schemes in place, which interact with each other, and with amendments in subsequent Finance Acts, the time from which various changes apply can be tricky to identify. To make this process easier we have listed in time order the various changes. This is only intended as an aid to comprehension, and more detailed guidance should be consulted in case of any doubt.

01/04/00 SME scheme introduced. Minimum spend in an accounting period set at £25,000 per annum. For accounting periods straddling 1 April 2000, it only applied to expenditure on or after that date CIRD90000.
   
28/07/00 DTI Guidelines on the meaning of R&D issued CIRD81990.
01/04/02 Large company scheme introduced. Minimum spend in an accounting period set at £25,000 per annum CIRD81600.
01/04/02 SMEs able to claim under the large company scheme for qualifying expenditure where they act as subcontractor to large company and are unable to claim under SME scheme in respect of expenditure incurred on or after this date CIRD89500.
06/04/03 ITEPA changed the definition of staffing costs incurred in accounting periods ending on or after this date to include certain benefits CIRD83200.
09/04/03 For accounting periods beginning on or after this date, SMEs able to claim the relief under the large company scheme where they were barred from a claim under the SME scheme only by reason of being in receipt of subsidised expenditure CIRD89000.
09/04/03 For accounting periods beginning on or after this date the minimum spend in an accounting period for large companies set at £10,000 CIRD81600.
09/04/03 Expenditure incurred on or after this date by large companies on externally provided workers becomes qualifying expenditure CIRD84000.
09/04/03 For expenditure on staffing costs incurred on or after this date there is no 80:20 arrangement under the large company scheme CIRD83800.
27/09/03 For accounting periods beginning on or after this date minimum spend for SMEs set at £10,000 CIRD81600.
27/09/03 Expenditure incurred on or after this date by SMEs on externally provided workers became qualifying expenditure CIRD84000.
27/09/03 For expenditure on staffing costs incurred on or after this date there is no 80:20 arrangement under the SME scheme CIRD83800.
05/03/04 New guidelines on meaning of R&D issued. Brought into force by SI2004/712 for accounting periods ending on or after 1 April 2004 CIRD81900.
01/04/04 ITEPA change to staffing costs reversed CIRD83250.
01/04/04 Consumable items and computer software introduced as, and consumable stores ceased to be, categories of qualifying expenditure for expenditure on or after this date for both the SME and the large company schemes CIRD82450, CIRD82300 and CIRD82500.
01/01/05 New EU definition of SME to be effective from this date CIRD91500.
01/01/05 Changes to the timing of the relief where expenditure incurred in accounting periods beginning on or after this date is not written off immediately to the profit and loss account CIRD98500.
31/03/06 For accounting periods ending on or after this date the time limit for claims to the enhanced deduction against profits becomes the anniversary of the filing date for the CT return in which the claim is made CIRD81800 
01/04/06 Expenditure incurred on or after this date by large companies on subjects of clinical trials became qualifying expenditure CIRD84400 
01/11/06 HMRC sets up specialist R&D units to deal with all claims from companies dealt with outside the LBS CIRD80300 
01/04/08 Clinical trials. New category of expenditure for SME Scheme
01/04/08 Enhanced deduction in Large Scheme increased from 125% to 130% of qualifying expenditure
01/08/08 Enhanced deduction in SME Scheme increased from 150% to 175% of qualifying expenditure
01/08/08 SME’s and Vaccines schemes only. Limits relief to companies that are a going concern when claim is made. (CIRD75100 and CIRD81130)
01/08/08 SME and Vaccines schemes only. Limit of €7.5m on the total amount of aid which can go to any one R&D project.(CIRD81160)
01/08/08 Definition of SME extended in relation to expenditure incurred on or after this date. (CIRD91900)
01/08/08 Vaccines Research Relief. Appropriate deduction decreased from 50% to 40 % of qualifying expenditure.(CIRD75600)
01/08/08 Definition of staff costs extended to include overseas NI costs. (CIRD83200)
01/08/08 Vaccines Research Relief Change of conditions applying to subcontractor payments to a charity, university or scientific research organisation. (CIRD75525)
01/12/08 Change of Status. (CIRD92000)
26/03/09 CTA 2009.
9/12/09 SME scheme only. Removal of IP condition for accounting periods ending on or after this date. (CIRD81550)
1/4/11 Enhanced deduction in SME Scheme increased from 175% to 200% of qualifying expenditure.
1/4/12 Enhanced deduction in SME Scheme increased from 200% to 225% of qualifying expenditure. (CIRD80250)
1/4/12 R&D threshold removed in relation to accounting periods ending on or after this date. (CIRD81650)
1/4/12 Company not a going concern in administration or liquidation in relation to claims made on or after this date. (CIRD81130)
1/4/12 Removal of restriction of tax credit to PAYE and NIC liabilities in relation to accounting periods ending on or after this date. (CIRD90500)
1/4/12 Vaccines Research Relief for SME’s abolished in relation to expenditure incurred on or after this date.
1/4/12 Calculation of qualifying expenditure on externally provided workers relaxed in relation to expenditure incurred on or after this date. (CIRD84000)
1/4/13 Research and Development Expenditure Credit (RDEC) introduced for expenditure incurred on or after this date.
1/4/14 Payable tax credit rate increased from 11% to 14.5%.
1/4/15 Consumable items: no relief for consumable items that make up part of a product that is sold in the course of a company’s ordinary business. Restriction applies to expenditure on consumable items incurred on or after this date.
1/4/15 Enhanced deduction in SME scheme increased from 225% to 230% of qualifying expenditure.
1/4/15 RDEC rate increased from 10% to 11% of qualifying expenditure.
1/8/15 Institutions of higher education (including universities) and charities cannot claim RDEC for expenditure incurred on or after this date.