Ask the Experts at ABGI UK

Top tips on myth busting in R&D

9th September 2019, 2:39 pm

Jumpstart is an independent science and technology company focused on helping companies secure innovation funding through HMRC’s R&D tax scheme. We believe that companies get the best results by using people who actually understand the science of what they do, so please see below 9 of our top myth busting tips that will hopefully help you successfully claim through your business.

1: You can only claim for your current financial year…


  • You can make a retrospective claim up to 2 years from your current EoY
  • Move on this right now so you don’t lose a year’s worth of benefit!

2: Receiving a grant is a death knell for a claim…


  • Some grants can complicate an R&D tax relief claim, but still be eligible
  • Some place into RDEC Scheme, 9.7% net (not bad for spending someone else’s money!)
  • Some grants allow relief on your company’s own expenditure through the SME scheme

3: If you are subcontracting the R&D out, you can claim 100% of the cost:


  • SMEs can only claim relief on 65% of the cost NOT 100%
  • Large companies cannot claim for subcontractors costs

4: You can’t claim if you are the subcontractor doing R&D for another company.…


Complex area  – real acid test would be:

  • Who is responsible for identifying and resolving technical uncertainties?

– If it’s you, you are eligible


  • Who bears the financial risk?

– If it’s you, you are eligible

Tip: Be clear in your contract!

5:   My company meets criteria for an SME, so we can claim through that scheme!


Be careful:

  • If your company is majority owned by an investor whose collective portfolio adds up to a large company, have to claim under RDEC

6:   Routine testing doesn’t qualify for relief!


It does IF the routine testing is required to:

  • confirm a particular uncertainty has been resolved within the project


  • validate that an advance has been realised

7: You can claim relief on any costs associated with an R&D project!


Many advisers will take a relaxed view, but outside HMRC guidelines:

  • Professional fees (accountants, lawyers, consultants unless they are undertaking subcontract R&D activity)
  • Market research
  • Attendance at conference
  • Foreign travel
  • Investment in your business infrastructure

8: You can only claim for successful projects

Good news! It’s a MYTH!

  • You can claim R&D tax relief for ANY eligible R&D activity whether there is a successful outcome or not.
  • Projects with greater levels of technical challenge/uncertainty are more likely to fail, so should be rewarded.

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