R & D tax regime review – Spring Budget 2017

John Moore, March 8th, 2017

Review of  R&D tax credits

In the 2016 Autumn Statement the Chancellor announced a review of the tax environment for R&D to look at ways to build on the introduction of the ‘above the line’ R&D tax credit to make the UK an even more competitive place to do R&D. The results of the review were to be published in the spring of 2017.

Today in the Spring Budget the chancellor announced that the review of the R&D tax regime has found that the UK’s R&D tax credits regime is an effective and internationally competitive element of the government’s support for innovation.

Indeed to further support investment, the government will make administrative changes to the Research and Development Expenditure Credit (RDEC) to increase the certainty and simplicity around claims and will take action to improve awareness of R&D tax credits among SMEs. No details have been published as to the nature of the changes to the RDEC, however we will keep you update as this becomes clearer.

The government has also said that it will continue to keep the competitiveness of the UK environment for R&D under review to ensure that the UK is profoundly pro-innovation.

Our view

Any improvement to the R&D tax credit schemes resulting in increased certainty & simplicity for claimant companies is welcomed. Both the SME and RDEC schemes currently give companies the ability to reduce their tax payable or obtain payable tax credits if they are not in a tax paying position. For R&D performing companies this is vital source of additional funding in support of their contribution to the UK economy.



This briefing is prepared by Kingly Brookes LLP, a limited liability partnership. For further information on any of the material contained in or referred to in the briefing, please contact us. This briefing note is intended to keep our readers up to date with the developments in this area, but it is a general guide only and is not intended to be a comprehensive statement of the law and practice in this area. No liability is accepted for the opinions it contains or for any errors or omissions.