R&D success stories: meet the companies claiming back cash
Meet the innovative companies who have successfully recovered money through the SeedLegals R&D Tax Credits service.
R&D tax reliefs have long rewarded companies that work on innovative projects in the UK.
While that will continue to be the case, from April 2023, there’ll be changes to the cost categories and rate changes for both the SME and RDEC schemes. If you work in a data-intensive industry it could be good news for you.
There are 5 cost categories for R&D:
These categories will stay in place, but from 1 April 2023, new criteria will apply:
Subcontracted spend from outside the UK will no longer be eligible for inclusion in R&D claims.
The aim of this is to bring more R&D activity to the UK and incentivise companies to move operations into the UK.
Currently, costs relating to cloud-based technology can’t be included in an R&D claim.
From April 2023, cloud-based computing costs such as AWS will be eligible for inclusion. This is very good news for companies who develop technology using cloud-based means.
Currently, activities which relate to pure mathematics aren’t not eligible for inclusion in R&D claims.
From April, companies will be able to claim a proportion of costs relating to pure maths activities, meaning companies whose R&D relates to quantum computing or deeptech will benefit.
It’s not just the scheme criteria that’s changing. HMRC will also update the way you need to submit your R&D claim from April 2023. Although not confirmed yet, here’s a breakdown of what we expect:
The government announced rate changes to the R&D schemes in the Autumn Statement.
The SME R&D scheme benefit for loss-making companies will decrease from a maximum of 33% cash back to 18.6%.
This reduction in the generosity of the SME R&D tax relief scheme is due to fraudulent activity detected by HMRC. The OBR states that these changes will not have a detrimental effect on R&D investment in the UK.
R&D Tax Lead,
The RDEC rate will increase from 13% to 20%. That means that the overall tax benefit from the RDEC scheme will increase from 10.54% to 16.2%.
R&D tax relief remains an important way to ensure that companies are bringing cash into their business and will still remain a valuable growth tool for genuine claimants.
At SeedLegals, we can help you navigate the complex legislation, confirm whether you are eligible to claim and how much you are likely to get back as a reduction in corporation tax liability or a cash credit.
R&D Tax Lead,
In 2021, the government announced a new corporate tax rate rise which will come into effect on 1 April 2023.
The rate rise will hit profit-making companies hardest and make calculating their tax rate more complex:
You can speak to us if you’d like to discuss how the changes affect your circumstances. Book a free call with our R&D experts.