R&D April Changes Deck Flashcards
Familiarise London SD with the changes to the R&D Tax Rebate Scheme (18 cards)
Under the merged scheme, what is the current rate that SME firms can claim back their expenditure up to in a loss making position?
& what was it previously?
SME firms can currently claim back their expenditure up to 16.2% in a loss-making position under the merged scheme.
Previously, SME firms could claim back their expenditure up to 33%.
What are the new cost categories that have recently been added to the R&D scheme?
The new cost categories added to the R&D scheme are pure mathematics and applied mathematics.
What is the current industry rate of enquiries?
The current industry rate of enquiries is 20%.
As of 2024, what is the post-tax RDEC rate?
As of 2024, the post-tax RDEC rate is either 16.2% or 15%, depending on the specific circumstances.
If a 1,200-staff software business (March YE) is qualifying £1.4m per year in QE, what will their benefit be for 2023 and 2024, assuming £1m profit?
For 2023, the benefit will be £226k, and for 2024, the benefit will be £280k.
If an SME spends £600k on software developers, qualifying at 40%, what will their benefit be for a 2024 claim in a profit-making position?
The benefit for a 2024 claim in a profit-making position will be £40k.
What will the benefit be for a 2025 claim?
The benefit for a 2025 claim will also be £40k.
A software company has an overseas development team with £800k spend, presuming they have a normal UK function (not just one staff member, so there is no NIC), qualifying at 45%. What would they be able to claim back for a 2023 and a 2024 claim?
For a 2023 claim, they would be able to claim back £234k. For a 2024 claim, they would not be able to claim back anything.
What have HMRC introduced to ensure culpability for the claim for the claimant company?
HMRC has introduced the requirement for a signed agent to ensure culpability for the claim.
What are the two rates for loss-making SMEs, and how do they change between 2024 and 2025?
The rate for loss-making SMEs is 16.2%, and it remains the same for both 2024 and 2025.
An engineering company qualifies at 20%. They have £730k in tech salaries and are profit-making. What is their benefit, and presuming a 20% fee, what is Leyton’s benefit for a claim done in 2023, 2024, and 2025?
For 2023, the company’s benefit is £7.2k, and Leyton’s benefit is £1.44k. For 2024 and 2025, the company’s benefit is £4.5k each year, and Leyton’s benefit is £0.9k each year.
What was the intensive R&D threshold?
The intensive R&D threshold was 40%.
Overseas spending – is this in effect from 1st April 2024, or for accounting periods starting after April 2024?
This is in effect for accounting periods starting after April 2024.
Rate changes – how are these implemented as of 1st April 2024? Are they done on accounting periods or do they straddle the time period?
Rate changes are implemented based on accounting periods.
Under the merged scheme, is the tax benefit received above or below the line?
Under the merged scheme, the tax benefit is received above the line.
When was advance notification introduced?
Advance notification was introduced on 1st April 2023.
When was the AIF introduced?
The AIF was introduced on 8th August 2023.
