Innovation Tax Reliefs

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HMRC provide a number of financial reliefs or incentives to encourage businesses to invest in innovation. These include:

R&D Tax Reliefs provide tax deduction for smaller and medium sized businesses (SMEs) under the SME scheme, or a Research and Development Expenditure Credit (RDEC) for large companies qualifying R&D expenditure. Often these reliefs are also collectively referred as R&D tax credits.

The table below summarises. the potential tax benefit for to be gained under the two schemes pre 1st April 2023 and post 1st April 2023.

The government has published draft legislation setting out the design for a merged SME and RDEC scheme, replacing the separate existing schemes. This is following an initial consultation in January 2023, in which Tax Advisory Partnership actively participated. The new merged scheme could come into force as early as 1 April 2024, however, the introduction of a merged scheme is not yet confirmed.

It is suggested that this merged scheme will operate in a similar manner to the existing RDEC scheme, rather than the SME scheme. The merged scheme will offer a taxable credit, based on a percentage of R&D expenditure, that can be offset against a company’s tax liability or, subject to some adjustments, be paid in cash to the business.

How can we help?

At TAP we provide Innovation Tax Reliefs services with a difference. We offer a unique blend of technical expertise, experience, and a delivery approach where the client’s needs are our priority.

We work with owner managed businesses and private equity backed groups, together with large international and quoted groups.

Working across the UK and leveraging our international network, we can bring the latest tax opportunities based on evolving tax legislation and HM Revenue & Custom’s (HMRC) approach.

We have brought together a number of detailed webpages that should help you if your business is involved in creating intellectual property, developing techniques to improve efficiencies or working on developing ground-breaking ideas in your sector. Our pages will help you determine if your R&D activities are likely to qualify for tax relief and our R&D Tax calculator should help you quantify the amount that may be available to you.

If you are considering investment in R&D our team can help you understand what types of expenditure will be allowed and the best way to organise your accounting processes to ensure your claim is successful.

Click on the image map above to go directly to the relevant pages to find out more. Our Innovation Tax Reliefs team are very approachable so please give us a call on 020 8037 1030 to explore how we may be able to assist you to make a claim for tax relief, alternatively complete the enquiry form on this page and we’ll get in touch with you.