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R&D Tax Relief – Additional Information Required

Newsletter issue – October 2023

Research and Development (R&D) is a Corporation Tax relief that is a Government support to some UK companies working on innovative projects in science and technology. There are currently two R&D schemes:

1. For large companies, Research and Development Expenditure Credit (RDEC) and
2. For small or medium enterprises (SMEs), SME R&D tax relief

There are strict terms and conditions of eligibility and the Government has introduced measures to tackle what it perceives as abuse of this support package and non-compliance. At the same time, though, they have updated what counts as qualifying expenditure, including 21^st century realities such as costs for data licences and cloud computing. 

For NEW R&D relief claims for accounting periods starting on or after 01 April 2023, from 08 August 2023 the following changes are in place:

• New claims must be made digitally accompanied by a compulsory additional information form
• Notifications must be made in advance of any R&D claim being made on a Corporation Tax return, and
• The notification and additional information form must contain details of any agent involved with making the R&D claim

Note that not all companies involved in innovation will be entitled to claim R&D tax relief. An accountant will be able to advise on an effective and achievable business plan for your company and help make a grant application - or advise if an application will be turned down.