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.
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.
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How can Zest R&D help you?
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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.
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.
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.
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.
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.
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.
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.
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.
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%