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. At AAB, we go beyond just having accountants on your R&D claims—we include engineers too. This unique combination of technical expertise and financial precision ensures we maximise your benefits and keep you compliant.

Derek Gemmell

Corporate Tax Partner & Head of Innovations Tax

Contact Derek Meet the team

Who we can help

ENTREPRENEURS
MULTINATIONALS
PRIVATELY OWNED & LISTED BUSINESSES
PUBLIC & SOCIAL SECTOR ORGANISATIONS
SMEs
START-UPS

How we can help

PREPARATION OF CLAIM FOR ENHANCED TAX RELIEF FOR R&D EXPENDITURE
PATENT BOX CLAIMS
PLANNING TO MAXIMISE R&D & PATENT BOX CLAIMS
ASSISTANCE IN DEALING WITH HMRC ON R&D & PATENT BOX

REWARDING YOUR INNOVATIVE SPIRIT

Speak with our R&D & patent box tax team

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. Our team of both accountants and engineers ensures your claims are robust and precise.

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. 

COMBINING ENGINEERS & ACCOUNTANTS FOR SUPERIOR R&D TAX RELIEF

Our unique approach combines the expertise of both engineers and accountants to ensure your R&D claims are thorough and successful.

Our engineers play a crucial role in identifying which projects qualify as R&D activities, ensuring they meet tax authority criteria. They provide detailed technical documentation, explaining the advancements and uncertainties involved, and assess the direct and indirect costs associated with your projects. This technical rigor ensures your claims are justified and compliant with the latest guidelines, minimising the risk of rejections or audits.

Meanwhile, our accountants compile and organise all financial records related to your R&D activities, calculate the eligible tax credits or deductions, and prepare the overall R&D tax relief claim. They integrate the technical documentation provided by our engineers with the financial data, ensuring the claim adheres to all relevant tax laws and regulations.

By combining the strengths of our engineers and accountants, we can provide an unparalleled comprehensive R&D tax relief service that addresses your needs and challenges, maximising your benefits and ensuring compliance.

Get superior R&D tax relief advice

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 be able to claim tax relief. 

As we said previously, we address these challenges by combining the expertise of both engineers and accountants. Our engineers identify and document qualifying projects, ensuring they meet the technical criteria set by tax authorities. They provide detailed descriptions of the R&D activities and assess associated costs, ensuring technical compliance. Meanwhile, our accountants compile financial records, calculate eligible tax credits, and prepare and submit the claims, ensuring all regulatory requirements are met.

This collaborative approach ensures that your R&D claims are both technically robust and financially accurate, maximizing your benefits and ensuring compliance with HMRC guidelines.

Talk to us to see if you’re eligible for R&D 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.

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 are becoming more complex 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. 

Talk to our R&D & patent box tax team

Sign up for the latest industry insights

Blog1st Oct 2024
Employee Share Scheme Options for Property Businesses
Share Incentives and Property Businesses In our experience assisting property and construction businesses, one recurrent and challenging question is how to retain top talent through equity incentives. While various tax-efficient share schemes exist, such as the Enterprise Management Incentive (EMI),…
By Kate Naylor
View more
Blog18th Sep 2024
VAT on Private Schools: 4 Key Considerations
The UK government has announced significant changes to the taxation of private school fees, set to take effect from 1 January 2025. This applies to all fees paid after 29 July 2024 when they relate to school terms after 1…
By Gabrielle Scotford
View more
Blog17th Sep 2024
Working in Denmark: What Are The Key Tax Implications?
Will your employees soon commence working in Denmark? Before embarking on an international assignment to Denmark it’s essential to ensure careful planning and consideration, especially when it comes to your UK-resident employees. We explore the factors surrounding income tax implications for…
By Carol Sim
View more
Blog7th Sep 2024
R&D Tax Relief Claim Notifications- What Do You Need To Know?
For accounting periods commencing on or after 1 April 2023, there is a new notification obligation to be considered by all companies seeking to claim R&D tax reliefs. The rules are intended to catch new R&D tax relief claimant companies.…
By Ross Parsler
View more