In the 2022 Autumn Statement, the government announced that the rates for SME R&D tax credit will be reduced from 1 April 2023. The effective return for loss-making SMEs will therefore reduce from 33.4p/£ to 18.6p/£.
The government recognised the importance of R&D activities carried out by SMEs to the UK’s wider innovation ecosystem. To support these businesses, an increased rate of relief for loss-making R&D intensive SMEs was announced in the 2023 Spring Budget. For expenditure incurred from 1 April 2023, eligible R&D intensive SMEs will be able to claim 27p/£ from HMRC for qualifying R&D expenditure.
The draft legislation is expected in July 2023.
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