HMRC R&D Tax Credits

29 January 2019

HMRC Research & Development (R&D) Tax Credits are designed to incentivise and encourage firms to invest in the development of innovative products and/or services.


It allows organisations to recoup substantial development costs as cash or credit for every year of qualifying R&D activities and works by allowing your business to include an additional deduction in calculating its taxable profits, whether you are profitable or loss-making.


What constitutes R&D:

  • Developing new products
  • Modifying existing products
  • Implementing new systems and software
  • Attempting to resolve a problem


Examples of qualifying R&D Tax Expenditure:

  • Staffing Costs
  • Software
  • Utility Bills
  • Materials
  • Possible Sub-Contracted Costs

Even though the R&D scheme is designed to stimulate innovation by encouraging companies to invest in research and development, the scheme is underutilised in Northern Ireland with recent government statistics revealing that only 640 companies made a claim.

Give us a call if you require any further information on HMRC R&D Tax Credits.