Government plans further tax breaks for R&D

Posted: 27th April 2012

University style builidngRecognising the importance that research and development (R&D) has in adding value to products of all kinds and the increasing need for companies of all sizes to invest heavily in R&D, the Government has announced that it intends to introduce a more generous system for an ‘above the line’ tax credit for research and development
It will extend the incentives that are currently only available to smaller businesses to companies of all sizes. Some restrictions applying to the current regime applicable to small businesses are also to be eased.
The relief works by creating a ‘superdeduction’ of (currently) 225 per cent of the relevant R&D expenditure. The operation of the new scheme will be finalised after the completion of a consultation process that ends on 29 June.
The aim is to make the UK an extremely attractive place for companies to carry out R&D work.
The changes are expected to be introduced in April 2013.