The minimum expenditure requirements for R&D tax credits

The minimum expenditure requirements for R&D tax credits

There is no minimum amount of qualifying expenditure for an R&D tax credit claim. The credits exist to support innovation in businesses of all sizes and there are no minimum expenditure requirements as part of HMRC’s eligibility criteria.

History of expenditure requirements for R&D tax credits

It used to be the case (up until April 2012) that companies were required to have incurred at least £10,000 of qualifying R&D expenditure, but this low-end threshold has been removed. Consequently, any company that is able to meet and evidence the eligibility criteria can expect to receive a benefit which is not restricted by a minimum figure.

Numerous factors (such as grants, subsidies, subcontracting, boundaries of R&D, and contractual autonomy in carrying out the eligible activities) can variously affect and restrict a company’s eligibility for R&D tax credits. It is always worth speaking or partnering with a reputable adviser if you are unsure about your expenditure or eligibility.

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