The RDEC rate is 13%. This was increased on 1 April 2020, up from a previous rate of 12%. Deciding which scheme to use is largely dependent on the size of your business, but there are other factors that need to be taken into account.
You are classed as a large company for the purposes of R&D tax incentives if you employ more than 500 staff or you have a turnover of more than €100 million and more than €86 million in gross assets. The R&D tax credit rate for RDEC means that large companies could get over 10% of their R&D spending refunded.
For tax purposes R&D does not necessarily mean blue-sky research which is a common misconception that can prevent companies from receiving the benefits from HMRC that they are entitled to. RDEC allows the benefit of R&D to be accounted for within the Profit and Loss (P&L) account, above profit before tax, rather than only through the tax account. So, under the RDEC scheme, large companies who are loss making are now able to benefit from their development efforts for the first time, by way of an immediate net of tax cash credit.
The RDEC also enhances the company’s earnings before interest and taxes (EBIT), therefore ends up being more lucrative for larger companies. The scheme is now a straightforward subsidy against the level of R&D spend that your company incurs.
Our one and only goal is to get you the maximum benefit you deserve for innovating in the UK. When you meet our specialist, it will feel like you’re talking to a colleague rather than your advisor.
We don’t start with your balance sheet. We start by walking the floors and understanding the things you do and the things you make.
There is no conflict of interest. As this is all we do our advice will never conflict with other tax or audit advice you receive.
You are paying for our expertise (not to support a large corporate infrastructure). Experience tells us that when other firms prepare a claim that they leave some of the value off the table. Even the biggest names.
On average, we see an uplift of 200% over what companies have claimed themselves or using another adviser.
We are not the Big 4, and we are proud of it. We are the challenger and the better pair of hands. Innovation is about pushing the boundaries and embracing uncertainty to gain advancement.
Irrespective of what industry or sector you are, GovGrant can help you identify eligible activities for R&D for tax purposes. GovGrant are always on top of the latest changes in legislation. You can rely on our expertise, leaving you to focus on your main business.
With a tax credit rate of 13% from 1 April 2020, large companies, and some SMEs, could get more than 10% of their R&D spending refunded through the Research & Development Expenditure Credit (RDEC). You are classed as an RDEC qualifying company if you, and all connected companies, employ more than 500 staff. Even if you and all connected companies employ fewer staff, but you have a turnover of more than €100 million and more than €86 million in gross assets, you qualify for the RDEC scheme.
In addition, if you are an SME you might need to access the RDEC scheme if:
Irrespective of what industry or sector you are, GovGrant can help you identify eligible activities for R&D for tax purposes. R&D takes place when a project seeks to achieve an advance in overall knowledge or capability in a field of science or technology.
You can claim the RDEC tax credit rate of13% against certain costs that are allowable for tax purposes on the project including:
We will do the heavy lifting to put your claim together. The technical and financial reports explain how your R&D project: