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R&D tax credits, explained

Research & Development Tax Credits are a UK tax incentive designed to encourage companies to invest in R&D. Companies can reduce their tax bill or claim payable cash credits as a proportion of their R&D expenditure. R&D Tax Credits can be claimed on development of a new product, process or service, or improvements to existing ones – even if the work wasn’t successful.

Making a claim →

Are you eligible to claim?

R&D tax credits don’t just apply to white coat or laboratory based research. Companies in any industry may be eligible. Any work to improve a product, process or service, or even develop a new one, may be eligible – even if the work wasn’t successful. If this work required a scientific or technological problem to be solved that couldn’t have been resolved by a short conversation with competent professionals – some of the work probably qualifies as R&D.

If you’re not sure whether your work qualifies – contact us for a free consultation.

About Zest R&D →

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How can Zest R&D help you?

Request a free consultation

How can Zest R&D help you?

What costs can I claim for?

Staff costs for any time they spent on the R&D projects, including any National Insurance and Pension contributions.

65% of any costs related to freelancers or companies subcontracted to help with the Research & Development.

Consumable items, including any materials used within the R&D.

The cost of any software used as part of the R&D process.

The relevant proportion of water, fuel or power consumed as part of the R&D.

How much can I get back?

A profit making company can receive up to 25% of its Research & Development costs back. This will mean either a reduction of that value in your corporation tax bill, or a payable credit if you have already paid.

A loss making company can receive up to 33% of its Research & Development costs back. This will mean a payable credit from HMRC.

Try our calculator to give you an estimate of what you could claim back →

What costs can I claim for?

Staff costs for any time they spent on the R&D projects, including any National Insurance and Pension contributions.

65% of any costs related to freelancers or companies subcontracted to help with the Research & Development.

Consumable items, including any materials used within the R&D.

The cost of any software used as part of the R&D process.

The relevant proportion of water, fuel or power consumed as part of the R&D.

How much can I get back?

A profit making company can receive up to 25% of its Research & Development costs back. This will mean either a reduction of that value in your corporation tax bill, or a payable credit if you have already paid.

A loss making company can receive up to 33% of its Research & Development costs back. This will mean a payable credit from HMRC.

Try our calculator to give you an estimate of what you could claim back →

Use our calculator to estimate your tax credits.

What is the financial position of your company?

What is your estimated spend on R&D per year?

We estimate you could receive up to

£6,175

as a tax credit.

Show how this example is calculated

To reward businesses for their investment, the government allows you to enhance your qualifying expenditure.

£25,000 x 130% (enhancement rate) = £32,500

x 19% (Corporation Tax rate) = £6,175

£6,175 / £25,000 = 25%

We estimate you could receive up to

£30,875

as a tax credit.

Show how this example is calculated

To reward businesses for their investment, the government allows you to enhance your qualifying expenditure.

£125,000 x 130% (enhancement rate) = £162,500

x 19% (Corporation Tax rate) = £30,875

£30,875 / £125,000 = 25%

We estimate you could receive up to

£61,750

as a tax refund or reduced tax liability.

Show how this example is calculated

To reward businesses for their investment, the government allows you to enhance your qualifying expenditure.

£250,000 x 130% (enhancement rate) = £325,000

x 19% (Corporation Tax rate) = £61,750

£61,750 / £250,000 = 25%

We estimate you could receive up to

£247,000

as a tax refund or reduced tax liability.

Show how this example is calculated

To reward businesses for their investment, the government allows you to enhance your qualifying expenditure.

£1,000,000 x 130% (enhancement rate) = £1,300,000

x 19% (Corporation Tax rate) = £247,000

£247,000 / £1,000,000 = 25%

What is your estimated spend on R&D per year?

We estimate you could receive up to

£16,675

as a tax credit.

Show how this example is calculated

To reward businesses for their investment, the government allows you to enhance your qualifying expenditure.

£50,000 x 130% (enhancement rate) = £65,000

£50,000 + £65,000 (enhancement) = £115,000 (enhanced expenditure)

£115,000 x 14.5% (surrender rate) = £16,675

£16,675 / £50,000 = 33.35%

We estimate you could receive up to

£83,375

as a tax credit.

Show how this example is calculated

To reward businesses for their investment, the government allows you to enhance your qualifying expenditure.

£250,000 x 130% (enhancement rate) = £325,000

£250,000 + £325,000 (enhancement) = £575,000 (enhanced expenditure)

£575,000 x 14.5% (surrender rate) = £83,375

£83,375 / £250,000 = 33.35%

We estimate you could receive up to

£166,750

as a tax credit.

Show how this example is calculated

To reward businesses for their investment, the government allows you to enhance your qualifying expenditure.

£500,000 x 130% (enhancement rate) = £650,000

£500,000 + £650,000 (enhancement) = £1,150,000 (enhanced expenditure)

£1,150,000 x 14.5% (surrender rate) = £166,750

£166,750 / £500,000 = 33.35%

We estimate you could receive up to

£333,500

as a tax credit.

Show how this example is calculated

To reward businesses for their investment, the government allows you to enhance your qualifying expenditure.

£1,000,000 x 130% (enhancement rate) = £1,300,000

£1,000,000 + £1,300,000 (enhancement) = £2,300,000 (enhanced expenditure)

£2,0,300,000 x 14.5% (surrender rate) = £333,500

£333,500 / £1,000,000 = 33.35%