R&D Tax Relief
Research and Development (R&D) tax relief is a government financial incentive designed to incentivise innovation and reward companies who invest it.
HMRC consider R&D to be being carried out if you are creating, modifying, or improving a product or service, or solving a problem with no obvious existing solution. In addition to this, the work must set out to achieve an advance within the field of science and technology.
Launched in 2000 by HMRC, R&D tax credits provide valuable financial assistance to eligible companies to expand their teams, foster growth, and ultimately further their own research and development via refunds, corporation tax reductions, or a cash lump sum.
In accordance with the most up to date information provided by HMRC, the provisional estimated amount of total R&D tax relief support claimed for the tax year 2021 to 2022 was £7.6 billion, an increase of 11% from the previous year. This equates to £44.1 billion of R&D expenditure (8% higher than the previous year).