Research and Development Relief
From 1 April 2024 R&D Relief is only available for R&D intensive SMEs.
Enter the information to support R&D Relief claims in this section.
Claims for R&D Tax Credit should be entered in Trade > Losses > R&D Payable Tax Credit
For more information about surrenderable losses and the payable tax credit see HMRC Corporate Intangibles Research and Development Manual (opens in a new tab).
R&D Claims
| R&D claim form has been submitted |
For accounting periods beginning on or after 1 April 2023, companies may need to tell HMRC if they plan to claim R&D tax relief. Tick this box to if a R&D claim notification form has been submitted. The claim notification form is a digital form. Open HMRC guidance on claiming (R&D tax relief) by making a claim notification (opens in a new tab) |
| Additional information form has been submitted |
Companies must complete and submit an additional information form to HMRC to support all their claims for Research and Development (R&D). The additional information form must be submitted before or on the same the day the Company Tax Return is submitted. Tick this box to confirm that an additional information form has been submitted. Read HMRC guidance on submitting supporting information for your R&D claim (opens in a new tab). |
Qualifying SME R&D Expenditure
| Qualifying R&D Expenditure |
The total of all amounts entered in Trade > Turnover and Adjustments > Additions > Qualifying SME R&D expenditure will appear here. |
| Qualifying R&D Expenditure Analysis | Analyse the qualifying SME R&D expenditure by providing a description and amount for each item. |
Total Enhanced Expenditure
| Total qualifying expenditure |
This is the total of the analysed qualifying SME R&D expenditure. |
| Additional deduction | This is calculated as the total qualifying expenditure multiplied by 130% for expenditure before 1 April 2023 and 86% thereafter. |
| Total enhanced expenditure | This is calculated as Total qualifying expenditure plus Additional deduction |
For more information about Research and Development tax relief for small and medium enterprises please see HMRC's guidance (opens in a new tab).
Companies should complete the relevant sections depending on whether they are claiming either of the following:
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Research and Development Expenditure Credit (RDEC).
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R&D Payable Tax Credit for Small and Medium-Sized Enterprises (SME).
For accounting periods commencing on or after 1 April 2024, the merged scheme called RDEC and Enhanced R&D Intensive Support (ERIS) replaces the old RDEC and SME schemes.
For more information see HMRC's guidance (opens in a new tab)
RDEC
| R&D Expenditure on which RDEC is Claimed |
Enter the amount of qualifying expenditure on which RDEC is being claimed. |
| Qualifying RDEC Expenditure Analysis | Analyse the qualifying RDEC expenditure by providing a description and amount for each item. |
| Pre-Step 1 Restriction |
Companies should complete this section if:
Enter the total amount of Step 2 restrictions brought forward from previous accounting periods. You can also include any Step 2 or Step 5 RDEC surrendered from other group companies, even if the company is not claiming RDEC or SME payable tax credit in this return. |
RDEC Calculation (Steps 1 to 7)
These steps guide you through calculating the payable RDEC.
They cover aspects like Corporation Tax liability, notional tax charge, R&D workers' PAYE and National Insurance contributions, offsetting against outstanding tax liabilities, and more.
| Step 1: calculation of RDEC set against Corporation Tax liability |
Read the Corporate Intangibles Research and Development Manual for more information. For more information see Corporate Intangibles Research and Development manual (opens in a new tab) Enter the total amount of section 104N(2) step 3 which has been carried forward from earlier periods. For more information see Corporation Tax Act 2009, Section 104N (opens in a new tab) Enter the remaining Corporation Tax liability from the Pre-step 1 Restriction. If you did not complete the Pre-step 1 Restriction, enter the figure from box 475 on the CT600 Corporation Tax return. Enter the element of Income Tax deducted from gross profits and shown in box 515 which needs to be set against the Corporation Tax liability at box 475 on the CT600 Corporation Tax return |
| Step 2: calculation of notional tax charge |
This step restricts the potential payable element and ensures that loss makers receive the same net benefit as profit makers (the credit being taxable). This is achieved by retaining a notional tax so the total cash benefit for all claimants is equal to the expenditure credit, net of tax at the main rate of Corporation Tax. Enter the RDEC claim multiplied by the tax rate for this accounting period |
| Step 3: expenditure on R&D workers’ PAYE and National Insurance contributions |
This step further restricts any payable element to the company’s total expenditure on R&D workers’ PAYE and National Insurance contributions for the accounting period. The calculation of the capped credit for R&D workers’ PAYE and National Insurance contributions is set out in the Corporate Intangibles Research and Development Manual. For more information see Corporate Intangibles Research and Development Manual (open in a new tab) Total relevant expenditure on R&D workers’ PAYE and National Insurance contributions:
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| Step 4: RDEC to be offset against outstanding Corporation Tax liabilities | Any amount remaining after step 3 is used to discharge any outstanding Corporation Tax liabilities (due but not settled) of the company for any other accounting periods. |
| Step 5: amount surrendered to group member |
If the company is a member of a group it may surrender the whole, or any part remaining after step 4, to any other group member. Your computations must include details of the other group member you are surrendering the credit to. This information can be attached in PDF format. |
| Step 6: amount used to discharge other company liabilities |
Any amount remaining after step 5 is used to discharge any other liability of the company to pay a sum to the Commissioners, for example VAT or liabilities under any contract settlement. Enter the amount used to discharge other liabilities on the return, including those which are not Corporation Tax but treated as such, for example tax on loans to participators. Enter the amount used to discharge other liabilities outside Corporation Tax, for example, PAYE or VAT. |
| Step 7: payable Research and Development expenditure credit |
The final amount remaining is payable to the company provided that the company is a going concern. Enter the whole amount extinguished by section 104S of the Corporation Tax Act 2009 (the going concern rules). |
| RDEC carried forward |
This section summarises any amounts carried forward. Where amounts are surrendered to another group company, your computations must include details of the other group company you are surrendering the credit to. This information can be attached in PDF format. |
| RDEC surrendered | This section summarises any amounts surrendered. |
| SME RDEC Claims |
For more information see Corporation Tax Act 2009 Part 3, Chapter 6 (opens in a new tab) |