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Even better news on Research & Development costs

The tax repayable to qualifying companies, on Research & Development (R&D) costs after 1 April 2014, has been further increased to 14.5% (currently 11%).

This relief is especially relevant to start-ups where cash flow is crucial.  The change will make a generous relief even more attractive.

As an example, let us consider how a company with losses will benefit

  £

Qualifying R&D cost

100,000

Tax Credit Uplift

125,000

225,000

Total tax loss, say

400,000

Less R&D loss

225,000

Loss carried forward

175,000

Loss surrendered for cash

225,000

Cash available - now

Cash available after 1 April 2014

 24,750

 35,625

 

 

Date: 31st March, 2014
Author: Cathy Corns

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