R&D Tax Relief

R&D Tax Relief is a generous incentive for innovative companies, often worth around 25% of what you have spent on R&D.

What is R&D Tax Relief?

Do you pay technical staff to solve technical problems, perhaps developing new or improved processes, products, or software? Radius can help you claim R&D Tax Relief from HMRC, which is often worth around 25% of qualifying R&D spend.

Whether your company is big or small, old or new, or makes a profit or loss, you may be able to reduce your corporation tax bill or receive a payable cash credit. R&D tax relief is one of the most significant government-backed tax reliefs available today, but many companies do not realise they qualify.

Check your eligibility today

By taking 10 minutes to answer 11 simple questions about your company, you can determine your eligibility right now.

Who can apply for R&D tax relief?

In order to claim R&D tax relief, your activities must meet HMRC’s definition of R&D – however, this includes more than you may think.

  • Your project must firstly relate to your company trade, whether current or future.
  • Your project must have attempted to achieve an advance or an appreciable improvement in science or technology.
  • Your project must also have attempted to overcome technological or scientific uncertainty.
  • Your project may not have been easily worked out by a competent professional in the field.

It costs nothing to find out if you qualify, so check your eligibility today, or get in touch if you want to talk to an expert about your R&D activities.

Examples of qualifying R&D projects

  • Electronics company manufacturing innovative display equipment.
  • Software developers producing ground-breaking new software.
  • Steel heat treatment companies automating and refining processes.
  • Chemical manufacturers developing new compounds.
  • Engineering companies developing high performance components.
  • Animal feed manufacturer developing new health products.

These are just a handful of examples where we have helped companies claim R&D tax reliefs successfully. You can learn more about the wide range of activities, industries, and business types that we have helped in our free Case Study Guide.

Radius: R&D Tax Reliefs Done Properly

The Radius team of specialists offers a robust R&D tax relief claims service; our team of dedicated R&D specialists will prepare and maximise the value of your claim and identify wider tax-saving opportunities, while ensuring full compliance and minimising the effort required from you.

HMRC is cracking down heavily on error strewn R&D Tax Relief claims, so it has never been more important to work with an accountant you trust, with detailed quality assurance processes to ensure claims are fully optimised and compliant.

Radius has never had a claim amended as a result of an HMRC enquiry.

Our approach to R&D tax relief

The Radius process for R&D Tax Relief claims has helped us save our clients over £19m over the last 6 years, with an average client saving £38k. This includes both profit and loss making businesses from a wide range of industries.

Step 1: Free Consultation

We kick things off with a 30–60-minute initial discussion. This can be in person, over the phone, or via videocall. Here we will be introduced to your business and will explore whether we believe a R&D tax credit claim is possible.

Step 2: Building your claim

The dedicated Radius team will help you identify all qualifying R&D projects undertaken by your business and will help put your R&D tax relief claim together. We do most of the work, so you don’t have to; this includes gathering all technical information, putting together qualifying costs and knowing all the right questions to ask.

Step 3: Maximising your claim

Radius will work with you to maximise your claim within the scope of the legislation. We will produce the technical report and a summary of qualifying costs that is required to support a claim.

  • What is R&D tax relief?

    R&D tax relief is a Government programme that supports companies that take on innovative projects which seek to advance the overall state of science and technology across many different sectors. R&D tax relief can be claimed on innovative projects whether they are ultimately successful or not.

  • What qualifies for R&D tax relief?

    To qualify for R&D tax relief, your project must align with the specific Government definition of R&D.  

    Your project must relate to your company’s trade, whether current or future. It must also have attempted to achieve an advance or an appreciable improvement in science and technology. 

    To qualify, a project must also have encountered and attempted to overcome technological or scientific uncertainty. Finally, it must be something that could not be easily resolved by a competent professional in the field. 

  • What costs can you claim for?

    Not all costs related to an R&D project are eligible. Typically, the bulk of the qualifying costs are staff costs, that is, a proportion of the salary, employers’ NI and employers’ pension contributions in respect of individuals engaged in the R&D project.  

    It’s important to note that this does not include any dividends paid to director shareholders.  

    Consumables which are ‘used up’ in the R&D project, software costs, sub-contracted R&D and the costs incurred on Externally Provided Workers all qualify.

  • How do you claim for R&D tax relief?

    Companies may only claim for R&D tax relief via their Corporation Tax self-assessment return (CT600). In addition, it is strongly advised that companies submit a supporting narrative justifying the claim. There is a lot of information to consider, and many areas where it is easy to make mistakes which may undermine your claim.  

    Radius has never had a claim amended because of an HMRC enquiry; our team will be more than happy to help you with your claim.

  • How do you calculate R&D tax relief?

    To calculate the R&D tax relief your company may be entitled to, you will need to know exactly how much you spent on R&D for the project and must also understand the tax profile of your company. 

    We have built a handy calculator that is free to use and will give you an accurate estimate of what R&D tax relief you could receive. Try it today.

  • How far back can you claim R&D tax credits?

    R&D tax credits are a relief from Corporation Tax, and there is typically a 24month period where you may make amends to your Corporation Tax Return. You may therefore claim R&D tax credits for up to 2 years after the end of your accounting period.

  • How quickly can I get a repayment?

    HMRC aim to process SME claims within 28 days – though it can sometimes be more like 4-6 weeks after submission before any repayment or credit is issued.  

  • Will my R&D tax credit claim be successful?

    The success of a claim depends on your project’s suitability for R&D tax relief according to the Government criteria. Radius has never had a claim amended due to an HMRC enquiry. 

    All our claims are subject to a robust review process and we do not submit claims unless we are confident they are made in line with the legislation and HMRC guidance.

  • Can you claim R&D tax relief on subcontractors?

    Small and medium businesses carrying our R&D projects will generally be able to claim 65% of their subcontractor costs for qualifying activities. To qualify, the subcontractor’s work for you must be a component of your R&D project.

  • Can you claim R&D tax relief for software development?

    Yes! There are some specific guidelines to ensure software development qualifies for R&D relief but essentially the rules are the same as for any other sector – the project must be seeking to advance science and technology and the way to achieve that advance must not be obvious to an expert in the field.

  • Is it possible to claim R&D relief on overseas costs?

    In short, yes. It is important to remember that R&D relief is a relief for UK Corporation Tax, so the company undertaking the R&D project must be subject to tax in the UK. However, qualifying costs can be incurred overseas. Typically, we see this where SMEs sub-contract R&D costs, or where the claimant company engages Externally Provided Workers based overseas.

  • How much work is involved in preparing a claim?

    At Radius, we do all the hard work, so you don’t have to. We aim to ensure the process of preparing a claim is as easy as possible for the claimant, whilst ensuring the company retains a full understanding of the claim.  

    Our typical approach is a short meeting or call to discuss eligibility. Once this is confirmed, we would aim to have a more in-depth meeting with the technical experts in the company to obtain the information needed to explain why the work done qualifies for the relief 

    We would also need to liaise with the company’s finance team to obtain the financial costs. Once we have this information, we then turn this into a claim, with clear supporting documentation explaining eligibility. We aim to ensure that our narrative in support of the claim is concise but contains sufficient information to ensure HMRC does not have any queries in relation to the claim.

  • How much do you charge for preparing a claim?

    Our fees are usually based on tax savings realised from a claim, usually payable on submission of the claim or on receipt of the credit from HMRC. For more information tailored to your claim, please speak to one of our team.

  • Can my company claim R&D relief if it has also received grant funding?

    Receiving grant funding, or indeed subsidies of any kind towards an R&D project, can have an impact on an R&D Tax Relief claim. Whether and to what extent depends on the type of grant funding and the purpose for which the grant was given. If you have received, or are planning to apply for any grants, contact us to understand whether there will be any impact

  • Do all companies claim the same R&D relief?

    No, there are two R&D relief schemes. The SME scheme is the most generous, offering relief of around 25% of qualifying costs. The SME scheme broadly applies to companies and groups with less than 500 employees and either a turnover of less than €100m or a balance sheet total of less than €86m (including worldwide linked and partner enterprises).

    The Research and Development Expenditure Credit (RDEC) applies to companies and groups outside this definition and offers relief of 10.53% of qualifying costs. In some cases SMEs have to claim the RDEC e.g. if they have received certain forms of grant funding. Contact us for help determining which regime would apply.