R&D tax credits > Client sectors > Technology, information and communication

R&D tax credits for technology companies

This sector includes many technical and software developers. There is often a strong case for an R&D credit for software development. Even when a company has developed software before they can demonstrate innovation in bringing that technology to address different challenges with different clients. Projects may require bespoke methodology and unique architecture solutions which could be eligible as R&D expenditure.

13,420

claims

£1,030

million

£76,751

Average claim value

What qualifies as R&D in the information and communication sector?

We find qualifying R&D expenditure in developing new operating systems or languages, creating new encryption or security techniques that don’t follow established methodologies, the development and testing of systems, devices or processes and the integration of legacy and new systems. Many companies are specialising in big data analytics where methods for analysing vast amounts of data haven’t existed before and need to be created in a new non-routine way. 

The telecoms industry is constantly innovating with the design of mobile and interactive services and the evolution of new generation networks

This sector includes the following types of business.

  • Telecommunications
  • Computer programming, consultancy and related activities
  • Information service activities including Data processing, hosting and related activities; web portals
  • Publishing activities
  • Motion picture, video and television programme production, sound recording and music publishing activities
  • Programming and broadcasting activities

Yes, information and communications companies can claim under either scheme depending on their size and other deciding factors. Of the R&D tax relief claims made in 2018-19 so far, 91% of them were under the SME scheme equating to 75% of the value claimed.

You can claim against certain costs on the project including

  • Employee costs including salaries, wages, Class 1 National Insurance contributions, pension fund contributions
  • Subcontractor costs
  • Software
    Consumable items including materials and utilities
  • Clinical trials volunteers in the pharmaceutical industry

Yes, information and communication companies that have already claimed for R&D tax credits might find that they could claim even more by applying for corporate tax relief the Patent Box scheme. In 2018-19, so far, only 40 companies claimed under Patent Box, totalling £71 million in benefit.

Information and communication sector business

Fintech

RD-artificial-intelligence-and-robotics

Artificial intelligence and robotics​

Telecoms

Technology, information and communication case studies

Computer Controlled Solutions Ltd

Industry: Information Technology

  • GovGrant helped make a claim against expenditure on an R&D project which failed initially
  • Claims made by CCS under the R&D tax credit scheme have increased by 500% over four years

Read full CSS case study

Tracware Ltd

Industry: Software

  • GovGrant helped claim R&D tax credits for multiple projects some of which spanned several years
  • This allowed the client to claim credit on approximately 25% of their investment which they reinvested in innovation to stay ahead of their competitors

Read full Tracware Ltd case study

Traffic Environment Systems Ltd (TES)

Industry: Mobile CCTV technology

  • GovGrant offered the client a holistic view of the incentives and tax reliefs used to promote innovation over a period of seven years
  • A successful IPO patent grant application allowed the client to benefit from Patent Box in addition to the R&D tax credit scheme

Read full Tracware Ltd case study

Veriserv Ltd

Industry: Monitoring solutions

  • Although initially unsure that they would qualify, GovGrant identified that a significant amount of eligible R&D
  • As a GovGrant client since 2010, Veriserv have successfully recovered tax free cash to the business of more than £100k

Read full Veriserv Ltd case study