So What Are R&D Tax Credits?

R&D Tax Credits are a government scheme which allows you to reclaim costs towards certain activities. 

However, the name is a little misleading. It’s not just about R&D in the traditional context, but covers a wider range of challenging technical activities. In addition, the specific definition of R&D for the purposes of R&D tax credits is NOT the same as the commercial, engineering or accounting definitions. It is defined as:

Work that attempts to advance scientific or technical knowledge by addressing one or more uncertainties.

This can include: creating new products, processes or services; making appreciable improvements to existing ones; or using technology to duplicate existing products, processes and services in a new way.

ARE YOUR PROJECTS ELIGIBLE?

The Challenge

Have you addressed a challenging TECHNICAL or SCIENTIFIC problem (or series of problems)?

Level of Advancement

Does the challenge represent a GENUINE ADVANCEMENT in the technology or scientific area, as opposed to just developing your own personal knowledge?

The Competent Professional

Would the problem CHALLENGE THE CAPABILITIES OF ANOTHER COMPETENT PROFESSIONAL in the relevant subject matter?

WHAT YOU CAN (AND CAN'T) CLAIM

You CAN claim...

PAYE Staff Costs
Subcontracted R&D
Consumable Items
Software used in your R&D
Clinical Trial Volunteers
Prototypes
Overhead Costs

You CAN'T claim...

Dividends and Bonuses
Production Costs
Marketing Costs
Rent and Cost of Land
Capital Equipment
Market Research
Patent Costs

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