R&D tax relief relaxation

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As has already been noted on this site, the condition that companies can claim research & development (R&D) tax relief on qualifying expenditure deriving only from intellectual property that they own has been removed for companies that are small and medium sized enterprises.

This change is welcomed but it is disappointing that the Government has not taken the opportunity to further widen the scope of eligible expenditure on which relief can be claimed.

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2 Responses to “R&D tax relief relaxation”

  1. Mark Joscelyne, Tax Partner Olswang Says:

    So there is still the rule that the SME cannot obtain the 150% relief on R&D work contracted out to it.

  2. Natalie Coope, Tax Associate, Olswang Says:

    You’re right, these rules did not change yesterday. SMEs can’t obtain the now 175% rate of relief on R&D contracted out to them but may obtain the 130% rate (which is the same as the large companies’ rate) of relief, albeit without any payable tax credit, on R&D contracted out to them by large companies or by persons not carrying on a UK trade, profession or vocation.

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