R&D expenditure credit to increase in new year

In under 2 weeks’ time, larger businesses will be able to claim an increased tax relief on their qualifying research and development (R&D) expenditure.
From 1 January 2018, the rate of the research and development expenditure credit (RDEC) will increase from 11% to 12%.
The RDEC is a standalone and above the line credit that is brought into account as a receipt in calculating profits.
It allows companies to claim an enhanced corporation tax deduction or payable credit on their R&D costs.
Figures released by the Treasury in September 2017 showed qualifying spending on R&D from businesses rose to around £23 billion in the 12 months to 5 April 2016.
Since R&D schemes were launched in 2000/01, more than 170,000 claims were made with around £16.5 billion in tax relief claimed.
The increase to the RDEC was announced in the Autumn Budget 2017, as a part of the Industrial Strategy’s objectives to increase productivity and growth.
In his Autumn Budget 2017 speech, chancellor Philip Hammond said:
“We are allocating a further £2.3 billion for investment in R&D, and we’ll increase the main R&D tax credit [the RDEC] to 12%, taking the first strides towards the ambition of our Industrial Strategy to drive up R&D investment across the economy to 2.4% of GDP.”
Talk to us about tax reliefs for your business.

Awards and Accreditations

Get in touch

Get in touch

If you would like to see full details of our data practices please visit our Privacy Policy and if you have any questions please email contact@grunberg.co.uk.

x