Advisor reviewing qualifying R&D costs and activities

R&D Tax Relief: Are You Eligible and Maximising Benefits?

Innovation drives growth — and R&D tax relief is a powerful tool to help fund it. Whether you’re a start-up developing new processes or an SME improving existing systems, the UK offers generous incentives to support your progress. But with recent changes to eligibility and schemes, it’s vital to claim correctly. At ASKFinance, we guide businesses through the complex landscape of R&D tax credits, making sure you receive the full benefit without compliance risk.

What R&D Tax Relief Means for Your Business

R&D tax relief is available to UK companies undertaking scientific or technological innovation — whether developing new products, processes, or significantly improving existing ones. As of April 2024, most businesses now fall under the merged R&D scheme, which allows qualifying companies to deduct an additional 86% of eligible R&D costs from their taxable profits. Loss-making companies that meet specific criteria may also receive cash credits of up to 14.5% on surrendered losses.

Which R&D Schemes Apply in 2025?

The merged R&D scheme (effective April 2024) covers most businesses and offers above-the-line credits of 15–16.2%.
The Enhanced R&D Intensive Support (ERIS) scheme applies to loss-making, innovation-heavy SMEs spending at least 30% of total costs on R&D — providing even more generous relief.
Grants no longer disqualify you from claiming relief — previously excluded, they can now be claimed via the merged scheme.

Avoid Common Pitfalls

Don’t claim for overseas subcontractors — work must be performed in the UK.
Misclassifying ineligible activities or subsidised costs may trigger HMRC scrutiny.