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View the related Tax Guidance about Research & Development Relief (R&D)

Research and development (R&D) relief 鈥� overview

Research and development (R&D) relief 鈥� overviewThis guidance note provides an overview of the research and development (R&D) tax reliefs for companies.See the Research and development tax relief summary diagram which summarises the R&D tax relief.See also Simon鈥檚 Taxes D1.401.For a factsheet which summarises the R&D tax regime and which can be tailored for an advisor鈥檚 branded headings, see the Client factsheet 鈥� research and development relief.Types of R&D tax reliefExpenditure by a company on R&D can be relieved in the following ways:鈥�for a trading company, revenue expenses are allowable as a deduction against the profits of the trade, and capital expenditure may be eligible for a 100% R&D allowance as detailed in R&D allowances in the Research and development tax relief 鈥� capital expenditure guidance note鈥�in addition, qualifying expenditure on R&D is eligible for additional R&D tax relief. Significant changes have been made to the relief available with effect for accounting periods beginning on or after 1 April 2024. There continue to be two different types of relief: the R&D expenditure credit (RDEC) and a scheme which is now only available to certain loss-making SMEs. Before April 2024, the SME scheme was the default for SMEs (whether making profits or losses), which could claim RDEC only for specific expenditure which did not qualify under the SME schemeThe 2024 changes extend beyond the type of relief available to a company. See below under 鈥楻eforms to R&D reliefs from April 2024鈥� for a summary of the changes.R&D tax