The United Kingdom's R&D tax incentives have been consolidating rather than expanding. Two schemes became one for accounting periods beginning on or after 1 April 2024, with a separate enhanced route for R&D intensive SMEs, and the compliance requirements around them have tightened considerably in the same period. This page maps what exists and who each part is for.
The relief itself
For accounting periods beginning on or after 1 April 2024 a company claims under the merged R&D scheme or, if it is a loss-making R&D intensive SME, under Enhanced R&D intensive support. Before that, the SME scheme gave an extra 86% deduction on qualifying costs on top of the normal 100%, a total 186% deduction, with a payable credit of up to 10% of the surrenderable loss, or 14.5% where the intensity condition was met. Which regime applies to a given claim is decided by the accounting period, not by when the claim is made.
What else the tax system offers innovation
Patent box taxes profits attributable to patented inventions at a reduced 10% rate, which is a separate relief with its own election and its own computation. Capital allowances relieve the equipment the research is done with, including a 100% first-year allowance route for qualifying plant. Creative industry reliefs cover film, television, video games, theatre and museums on a similar enhanced-deduction model. None of these overlaps with R&D relief and a company can be entitled to several at once.
The compliance side has grown faster than the relief
A claim now requires a claim notification for companies that have not claimed recently, submitted within six months of the end of the period of account, and an additional information form with every claim, mandatory since 8 August 2023. HMRC's enquiry activity in this area has been substantial. The practical consequence is that the cost of making a claim properly has risen, which is precisely why what the firms doing it charge is worth comparing, and why seven of the ten in this record will not tell you.
Questions people ask about r&d tax incentives
What R&D tax incentives does the UK offer?
The merged R&D scheme, with Enhanced R&D intensive support for loss-making R&D intensive SMEs, for accounting periods beginning on or after 1 April 2024. Patent box and capital allowances sit alongside them as separate reliefs.
Which scheme applies to my claim?
The one in force for the accounting period the expenditure falls in, not the one in force when the claim is made.
Can a company claim R&D relief and patent box?
Yes. They are separate reliefs with separate rules, and a company that develops and then patents an invention can be entitled to both.