The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
A company incurring qualifying R&D expenditure can claim a deduction equal to 230% of the relevant costs incurred in calculating its taxable total profits.
The deduction is given by allowing a further 130% of the qualifying R&D expenditure, in addition to the usual 100% deduction for such qualifying expenditure, in arriving at the adjusted profits for tax purposes.
HMRC has produced a guide to R&D tax relief for small companies which can be found at Making R&D easier for small companies.
The definition of an SME is detailed in the Research and development (R&D) expenditure ― overview guidance note and qualifying expenditure is set out in the Qualifying expenditure for R&D tax relief guidance note.
Note that where the company also qualifies to claim one of the creative sector reliefs (such as television tax relief and video games relief) it must choose between SME R&D relief and the creative sector reliefs, it cannot claim both in respect of the same project because they are both State Aid. An SME can claim large company R&D expenditure credit (RDEC) on the same project for which a creative sector relief claim has been made but the expenditure on that project can either be relieved under the creative sector relief or RDEC it cannot be relieved under both schemes, see below for more details of R&D claims where State Aid has been received.
Also see the Television tax reliefs ― key provisions and Video games tax relief ― key provisions and subsequent guidance notes for more on these other reliefs.
From 1 January 2021, with the end of the Brexit transition/implementation period entered into following the UK’s withdrawal from the EU, state aid rules have been replaced by a subsidy control system in the EU-UK Trade and Cooperation Agreement (TCA) which prohibits certain specified subsidies if the subsidies concerned have or could have a material effect on trade or investment between the EU and the UK. However the
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
Normal due dateIndividuals are required to pay any outstanding income tax and Class 4 National Insurance, Class 2 National Insurance, and capital gains tax due for the tax year by 31 January following the end of the tax year (ie 31 January 2021 for the 2019/20 tax year). From 6 April 2020, UK
The corporate interest restriction (CIR) essentially limits the amount of interest expense a company can deduct from its taxable profits if the interest expense is over £2 million. The actual mechanics of the CIR calculation are highly complex (the legislation is over 150 pages long) and are
What is structures and buildings allowance (SBA)?From 29 October 2018, expenditure on constructing a non-residential building or structure, or in certain cases, expenditure on acquiring such a building or structure, qualifies for an SBA. The following note has been updated for the changes announced
This guidance note provides an overview of the steps businesses need to take if aspects of their business change, and as a result, they need to notify HMRC about the change.Changes to name and / or addressIf a business changes its name and / or its address then it is required to notify HMRC of the
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.