R&D tax credit calculator

The R&D regime is undergoing significant changes, both in its mechanics and submission process. Notably, we are seeing that HMRC are enquiring into 20% of R&D tax relief claims submitted due to their belief of potential inaccuracies within these claims.

From 1 April 2024, the small and medium-sized enterprises (SMEs) and the Research and Development Expenditure Credit (RDEC) schemes were “merged”. Whilst there is now one scheme for the majority of companies, for loss making SMEs with enough R&D expenditure, there is an alternative scheme available.

Additionally, all R&D claims must now include an Additional Information Form (AIF) submitted prior to the claim. The AIF allows you to name an agent who assisted with the R&D claim, which we expect HMRC may use to decide which claims to investigate. Equally, HMRC may be interested to enquire into claims without an agent.

Despite these changes, it remains the company’s responsibility to self-assess its eligibility for an R&D claim. Ensuring the accuracy of any claim is crucial, as HMRC can impose financial penalties for errors. When determining whether to impose a penalty and its amount, HMRC considers whether the company has taken reasonable care. This can include evaluating the effort put into the claim and the involvement of any external R&D specialists. Conducting a thorough review prior to submission of the claim can help mitigate the risk of penalties.

It is important to seek advice as soon as possible if you believe you are entitled to an R&D tax refund. The claim and calculation process itself is complex, so talk to your professional advisors about the steps you need to take.

Disclaimer

Our calculator tool is designed to provide a useful estimate of potential claim value only. It does not constitute nor replace the need to seek professional advice.

Your exact return will depend on a large number of factors specific to your particular business and your particular scenario, in addition to needing to undergo a thorough review of qualifying expenditure, proportionality and other factors such as the use of subcontractors in R&D activities.

If you want to understand further what these changes might mean for you, or you are claiming for the first time and would like our support in calculating and filing your claim, then please get in contact with our team using the form below.