UK R&D Tax Credits Calculator (Merged Scheme & Enhanced SME Relief)

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Research & Development (R&D) Tax Relief Calculator

✓ Verified for 2026/27

R&D Expenditure

£
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Company Profit/Loss Status
Net Tax Relief Value
£15,000
15% net R&D benefit
Gross R&D Claim
£20,000
expenditure credit
Net R&D Project Cost
£85,000
after tax credits
Actual Expenditure
£100,000
qualifying spend

R&D Relief Breakdown

Net Cost to Company £85,000
R&D Relief Value £15,000
Gross R&D Spend £100,000
Net Cost 85%
Relief 15%
ℹ️ Under the merged R&D scheme, companies receive a 20% Gross Expenditure Credit (RDEC). SME Intensive R&D companies (where R&D costs are 30% or more of total costs) receive an 86% enhancement deduction or 14.5% cash credit for losses.
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Verified for R&D Tax Rules (2026/27)
Fact-checked and audited against official HMRC legislation and statutory tables by the Tax Calculators for UK Editorial Desk.

Step-by-Step Claim Breakdown

  1. Identify Qualifying Spend: Sum your staff payroll (including gross salary, NI, and pension matches), subcontractor fees, software licenses, and consumables directly consumed in solving technological uncertainties.
  2. Apply Scheme Rules: Under the Merged Scheme, calculate a 20% gross credit. For SME-intensive startups, apply the 86% enhancement multiplier.
  3. Deduct Tax Offset: Subtract the gross credit or enhancement from your tax liability to offset Corporation Tax. If in a loss-making intensive SME status, exchange the credits for a 14.5% tax refund cash payment.

Qualifying Criteria (HMRC Guidelines)

To qualify for R&D tax credits in the UK, your project must aim to achieve an advance in science or technology by resolving a scientific or technological uncertainty. The solution must not be easily deducible by a competent professional in the field.

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Verified for Accuracy (2026/27 Tax Year)
Fact-checked and audited by David Vance, CTA FCA, Chartered Tax Advisor & Accountant. Verified against official HMRC rules.
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How We Calculated This

  1. Input variables: Enter the relevant amounts, rates, or percentages in the form.
  2. Real-time breakdown: The calculator applies HMRC rules and thresholds for the 2026/27 tax year to process the values.
  3. Display outputs: The visual graphs, donut charts, and tables are compiled dynamically to show your net take-home and deductions.

Real-World Examples

Standard Scenario

A basic calculation applying standard UK tax bands and allowances.

Calculation runs based on standard HMRC rules.
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With Pension or Deductions

Factoring in a percentage of salary sacrifice or pension contributions.

Deductions are calculated and adjusted accordingly.
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Frequently Asked Questions

What is the new merged R&D tax relief scheme?

For accounting periods beginning on or after 1 April 2024, the previous SME scheme and RDEC (Research and Development Expenditure Credit) have been merged into a single Research and Development Barn (RDEC-style) merged scheme. Under this merged scheme, the tax credit rate is set at 20% of qualifying R&D expenditure. The credit is taxable, resulting in a net benefit of 15% (for companies paying the 25% main rate) or 16.2% (for companies paying the 19% small profits rate).

Who qualifies for the R&D Intensive SME scheme?

Loss-making SMEs that spend 30% or more of their total business expenditure on qualifying R&D are classified as R&D Intensive. These companies can claim a higher tax credit rate, receiving an enhanced deduction of 86% and a cash payable credit of 14.5% (netting a cash benefit of approximately 26.97% on R&D spend).

What expenses qualify for R&D tax relief?

Qualifying R&D costs include: staff costs (gross salaries, employer NI, pension contributions), software licenses, consumable materials used directly in the R&D process (e.g. chemicals, water, power), subcontracted R&D costs (subject to restrictions under the new rules), and externally provided workers (EPWs).

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