R&D Relief Changes: For SMEs And Subsidised Expenditure

With HMRC consulting on abolishing R&D relief for small and medium-sized enterprises ("SMEs") and R&D relief for subsidised expenditure, leaving only a slightly enhanced and less valuable Research & Development Expenditure Credit ("RDEC"), SMEs with R&D programmes and companies with subsidised R&D activities might maximise R&D reliefs by accelerating their activities and expenditure.

The government published draft legislation earlier this year, for the merger of the RDEC and the SME R&D relief.

Whilst no final decision has been made on whether the merger will actually happen, the publishing of draft legislation suggests that the government does intend to proceed with implementing such a combined scheme at some point and that the proposed effective date of 1 April 2024 is a real possibility.