Commentary

D1.422 Pre-trading expenditure and SME R&D relief

Corporate tax
Corporate tax | Commentary

D1.422 Pre-trading expenditure and SME R&D relief

Corporate tax | Commentary

D1.422 Pre-trading expenditure and SME R&D relief

An SME which is starting up in business may incur qualifying R&D expenditure before it begins to trade. In the normal way, such expenditure is treated as incurred on the first day of trading1.

Pre-trading expenditure election for alternative treatment for R&D

Special provisions allow an SME company with qualifying pre-trading expenditure to claim SME R&D relief for the accounting period in which R&D expenses are incurred if they would have been allowable if the company had then been carrying on the trade to which they relate.

To obtain the relief, the company must make an election to treat the

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