Research & Development credits, Patent Box claims and Capital Allowances are all great ways for businesses to generate cash, particularly given the current climate.

R&D credits are available to the majority of businesses subject to UK corporation tax, insofar as they are undertaking scientific or technologically challenging activities in order to achieve a scientific or technological advance. This can include, but is not limited to, activities such as new product development, new process development, improvements to existing products and processes and projects involving software development. The benefit of making a claim normally falls between 10p and 33p for every pound spent on qualifying R&D costs and typically results in either a reduction in corporation tax or a cash payment from HMRC.

Where you are undertaking qualifying R&D, it is likely that Patent Box may also be of interest. The Patent Box offers companies utilising patented technologies a reduced headline corporation tax rate of 10% on profits derived from those technologies. There is a common misconception that patenting technology is difficult, however the threshold is often lower than most people expect.

In addition to R&D and Patent Box specialists, PwC’s Innovations and Capital Incentives team also includes Capital Allowances specialists meaning that we can adopt a holistic approach for capital projects, in particular when considering the 100% Research and Development capital Allowances i.e. up to 100% tax relief on qualifying capital expenditure in the year of acquisition.

If you would like any support or have further questions relating to the above areas, please do let us know.

https://www.pwc.co.uk/services/tax/getting-the-most-out-of-innovation.html