During
his inaugural Budget speech, the new Chancellor announced a raft of investment
in research and development projects across the country.
These
announcements included minor amendments to the research and development tax
reliefs.
SME
Research & Development PAYE Cap
The
government had previously announced that from April 2020 the amount of payable
R&D tax credit that a qualifying loss-making company could receive in any
tax year was being restricted to three times the company’s total PAYE and NICs
liability for that year. However, following consultation this has been delayed
by one year, and will now come into force from 1 April 2021.
Research
and Development Expenditure Credit (RDEC)
The
tax relief for large companies (and in some cases Small and Medium sized
Enterprises) that carry out qualifying Research and Development and claim the
Research and Development Expenditure Credit has increased from 12% to 13%.
For advice on Research and Development tax please contact a member of our tax team.