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Contact Us ▪ Introductory Meeting / Quote
Call: 0207 309 2222
WHO CAN CLAIM RDEC?
Research and Development Expenditure Credit (RDEC) is typically claimed by large companies. Other factors such as having received grant funding and carrying out R&D work for a large company can restrict access to the SME scheme.
RDEC is available if you are a large company for R&D purposes with:
- more than 500 staff
- a turnover of more than €100m or a balance sheet total more than €86m
R&D FOR SMEs vs RDEC
The main difference between R&D for SMEs and the Large company scheme (RDEC) is the costs which qualify under the RDEC scheme. Subcontracted expenditure cannot be claimed unless it has been directly undertaken by a scientific research organisation i.e. a charity, university, or an individual.
WHAT DOES THE RDEC SCHEME COVER?
For large companies and SME’s who fall under the RDEC scheme you will be able to claim a tax credit for 12% of your qualifying R&D expenditure from 1st January 2018 and 13% from 1st April 2020.
HOW THE NUMBERS WORK
An RDEC claim is a taxable ‘above-the-line’ credit of 13% of the qualifying expenditure identified. This is subject to corporation tax at 19%, and is calculated as a deduction from your tax bill. If there is no tax payable, the net amount can be claimed as a cash credit.
A company has identified £100,000 of qualifying expenditure incurred on its R&D project.
The net RDEC amount claimable as a credit is calculated as follows.
Above the line credit: £100,000 x 13% = £13,000
Net RDEC amount claimable: £13,000 – (£13,000 x 19%) = £10,530
After tax benefit: £10,530 / £100,000 = 10.53%
SMEs with a turnover less than €100m, may be eligible to claim SME Research and Development Expenditure Credit.
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OVER £68 MILLION R&D CLAIMS SECURED
Jeffreys Henry LLP are specialists in hunting down every qualifying R&D cost and activity in your business.
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PARMINDER CHATTHA
Partner - Corporate and R&D Tax
Parminder specialises in Research & Development Tax Credits, leading the R&D department at Jeffreys Henry LLP. Since joining the Firm in 2015, he has been working closely with both SMEs and large businesses to analyse and maximise their Research and Development claims. He has so far secured over £70 million in R&D tax relief and credits for our clients.
JON ISAACS
Partner
Being close to Silicon Roundabout and London’s Tech City UK, Jon assists a large number of technology, digital and media companies with their R&D tax relief claim.
VIRALI PATEL
R&D Tax Manager
Being close to Silicon Roundabout and London’s Tech City UK, Jon assists a large number of technology, digital and media companies with their R&D tax relief claim.
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