R&D Tax Credits are a tax incentive from the UK Government designed to encourage companies to invest in Research & Development.
They can reduce your tax bill or you can claim payable cash credits usually within 8-12 weeks of your report being submitted as a proportion of your R&D expenditure.
The Government is keen to make the UK an attractive place to innovate and thus the incentives for companies to develop new and existing products, processes and services have continued to improve since its inception at the turn of the century.
You can get up to 32% of your development costs back in cash. HMRC will allow up to 130% additional tax relief on all ‘R&D expenditure’; hence any company spending £100K in R&D for example would be able to claim this as £230K of expenditure for the purposes of their corporation tax calculation.