Companies that undertake qualifying R&D activities can typically claim additional tax deductions based on the amount of expenditure incurred. These additional tax deductions reduce trading profits subject to corporation tax, or can create or increase trading losses. The key features of these generous tax incentives are:
R&D Tax Credits Explained
Research and development (R&D) tax credits are a government incentive designed to encourage companies to invest in innovation and R&D activities. The benefits of the incentive have increased in recent years as it is recognised that companies have to undertake R&D to stay competitive in the global economy. As such, the government is encouraging companies to undertake R&D and also to make a claim for R&D tax credits.
Key features of R&D tax credits
Who can benefit from R&D tax credits?
In a nutshell, companies that spend money developing new products, processes or services – or improving existing ones – may be eligible for R&D tax relief.
The R&D for these purposes does not have to be totally ground-breaking and you may be surprised what could qualify. For example, all manufacturing companies should in principle be carrying out an element of R&D in their business and even small amounts of R&D can lead to significant corporation tax savings.
Here are some recent examples of successful claims we have made for clients:
Is your company missing out on significant corporation tax savings that may be available?
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