R&D allowance is a specific form of capital allowances that provide tax relief to companies undertaking certain types of research and development in the UK.
Research and Development refer to the activities companies undertake to innovate and introduce new products and services. It is often the first stage in the development process in the making of a product that is most relevant, the goal is typically to take new products or services to market new ideas and add to the growth of the company with a unique approach.
Companies across all sectors can consider making a claim if they have produced anything new or have come up with the first time unprecedented service, however, some sectors are naturally at the forefront for R&D ie pharmaceutical and software/technology companies.
Costs that can be claimed not only include any materials used but the labour hours involved in the project, it is also worth noting that the product or service does not always have to work to be able to qualify for the R&D Allowance.
The tax forms can prove quite detailed and complicated for this niche tax reclaim and therefore it would always be best to discuss with us or an R&D specialist before considering making a claim.