R&D Tax Credits for the Science & Healthcare Sector
It may not be a surprise that this is the sector that claims the most in R&D tax relief. When we think of R&D activity it could well be that scientific or engineering firms come to mind. They are likely to have R&D as their core purpose and tend to have multiple qualifying projects. These firms can use these claims to help develop and test new products, materials and technologies.
What qualifies as R&D in the Science & Healthcare sector?
Scientific research and development, including pharmaceutical and biotech activity, are more obvious examples of businesses that have R&D at the core.
We find qualifying R&D expenditure in the development of new or alternative materials, product development including trials or prototypes through to full scale production batches and the development of new or improved diagnostical tools with better sensitivity, range or accuracy.
We often find that companies need to innovate in response to changes in health, safety and environmental legislation.
This sector includes the following types of business.
- Architectural and engineering activities; technical testing and analysis
- Scientific research and development
- Advertising and market research
- Legal and accounting activities
Yes, professional, scientific and technical companies can claim under either scheme depending on their size and other deciding factors. Of the R&D tax relief claims made in 2018-19 so far, 87% of them were under the SME scheme equating to 61% of the value claimed.