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R&D Tax Relief & Patent Box

Created to encourage UK companies to innovate and capitalise on their IP, R&D and Patent Box tax relief can be highly beneficial but complicated to claim. Our experience makes the process simpler and the tax benefits worthwhile. 

Contact Derek Gemmell

  • Derek Gemmell
    Meet the team

    The team

  • Start-ups. Entrepreneurs. SMES. Privately Owned & Listed Businesses. Multinationals. Public & Social Sector Corporate Organisations. 

    Who we can help

  • Preparation of claim for enhanced tax relief for R&D expenditure, Patent Box Claims, Planning to maximise R&D and Patent Box Claims, Assistance in dealing with HMRC Enquiries on R&D and Patent Box 

    How we can help

REWARDING YOUR INNOVATIVE SPIRIT

R&D tax relief offers the benefit of recouping much of the money you have invested in researching your innovation, while Patent Box tax relief reduces the rate of Corporation Tax on your income from your licensed patents.  

While both reliefs are attractive, it can be complex to claim them. We have a strong track record in negotiating the qualifying process and agreeing successful R&D claims with HMRC, to deliver very worthwhile tax savings for companies. Similarly, we have also utilised the available Patent Box reliefs to reduce the effective tax rate on commercial transactions, so our clients benefit from a greater return on their IP. 

COULD YOU CLAIM R&D TAX RELIEF? 

R&D Tax Relief allows innovating companies to claim tax relief for qualifying expenditure on their innovations. Relief for SMEs is currently at 230%, so every £1 of qualifying expenditure gains an additional £1.30 of tax relief. Larger companies could reduce their corporation tax liability or receive a repayment from HMRC by making a claim. 

There’s a common misconception that R&D tax relief is only available for scientific research, but that’s not the case. Innovation in any sector can qualify for R&D tax relief. If you’re creating new products, services, materials or processes or modifying existing ones, you are likely to be eligible.  

OTHER R&D TAX RELIEF MYTHS 

Loss-making companies often feel the only benefit they’ll obtain is increased losses carried forward. However, qualifying SMEs can surrender losses for a repayment from HMRC. Also, R&D tax relief can still be claimed even if there is no economic risk to the claimant, as their costs are covered by a grant or other funding. 

Companies sometimes think their R&D wasn’t successful enough, their business is too small or applying for relief takes up too much time. As specialists, we can dispel these myths. The key is that the R&D project must aim to overcome uncertainty to deliver an advance in a field of science or technology. We can even help if your R&D project failed, as you may still claim be able to tax relief. 

SIMPLIFYING THE CLAIM PROCESS 

R&D Tax Relief is aimed at SMEs. Determining whether your company qualifies can be complicated, because you’ll need to consider your whole group structure, plus the implications of sub-contracting arrangements. Using our years of experience of making successful claims, we can:  

  • Confirm your eligibility.  
  • Identify your qualifying projects and expenditure. 
  • Establish the rate of relief. 

We’ll handle the submission to HMRC with our tried and tested format and deal with any queries they might have. We’ll help secure payments and most importantly, we’ll maximise your claims to reduce the overall cost of your project. 

CLAIMING FOR PATENT BOX 

If your company holds your own qualifying patents and they are generating a profit, you should be able to benefit from Patent Box tax relief, which reduces the Corporation Tax applied to them to 10%. We can still claim for you if your qualifying patent is pending. The tax relief will accrue and be paid when the patent is granted. 

Our specialist innovations tax team will: 

  • check your company or relevant group member has the necessary qualifying IP rights. 
  • check that the patent(s) have been granted by one of the approved patent offices. 
  • help you identify the income you derive from your patents, to calculate your claim.

The qualifying rules became more complex in 2021 and the additional work involved may seem a deterrent. We suggest you talk to us, as the benefits might still sufficiently outweigh any extra costs involved. 

  • An essential part of the company's activities is a strong commitment to R&D with investment in a number of innovative projects. The company values the expertise of AAB in advising and securing invaluable tax benefit.

    Faris Samarai, Caledonian Airborne Systems Limited

  • For me, business is all about relationships, and the quality of what the team at AAB do to support us is a fundamental lever for us as we strive to meet the challenges and succeed as a group through and beyond challenging times.

    John Walsh, Online Electronics Limited

  • AAB have acted as tax advisers to our family and businesses for over 23 years and as a result have an in-depth knowledge of the goals and aspirations of each one of us both personally and for our businesses.

    McIntosh Family of McIntosh Plant Hire (Aberdeen) Limited

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