What R&D tax relief means now
Businesses still commonly search for “R&D tax credits”, but the rules have changed. For accounting periods beginning on or after 1 April 2024, claims are generally made under the merged R&D expenditure credit scheme or, for qualifying loss-making R&D-intensive SMEs, Enhanced R&D Intensive Support (ERIS).
The name of the scheme does not decide whether a project qualifies. The central question is whether the company sought an advance in science or technology and had to address scientific or technological uncertainty that a competent professional could not readily resolve.
Read Lexmore's guide to R&D tax reliefWhere qualifying R&D may arise in Leeds and West Yorkshire
Healthtech, medtech and diagnostics
Projects may address uncertainties in medical devices, diagnostics, imaging, data interoperability, clinical systems or the performance and reliability of health technology. The qualifying work must be separated from regulatory compliance, deployment and general product development.
Software, AI and data systems
R&D can arise where teams attempt to overcome non-routine technical constraints in performance, scalability, security, modelling or complex data integration. A platform is not eligible merely because it is new to the company or its customers.
Manufacturing and engineering
West Yorkshire manufacturers may undertake R&D in materials, products, production processes, automation, sensing and quality control. Evidence from trials, test data and competent professionals is usually more valuable than a broad claim that a product is innovative.
Fintech and professional technology
The commercial novelty of a financial or professional service does not qualify. The underlying software project may qualify where it seeks an advance in technology and faces genuine technological uncertainty, for example, in security, distributed processing or system performance.
Examples are not an eligibility test
The sector examples on this page illustrate where qualifying work can arise. A company does not qualify because it operates in a particular industry or location, and commercial novelty on its own is not enough. Eligibility depends on the project, the state of knowledge in the relevant field, the uncertainties encountered, the work undertaken and the costs claimed.
Health innovation requires careful boundaries
Healthtech projects can mix scientific, technological, clinical, regulatory and commercial work. A robust claim identifies the project boundary and includes only activity directed at resolving the relevant scientific or technological uncertainty, together with qualifying indirect activities allowed by the rules.
Patent Box for medical and engineering IP
Where a West Yorkshire company has developed and commercialised patented medical devices, diagnostics, manufacturing technology or other qualifying IP, Patent Box may warrant a separate review. The calculation concerns qualifying relevant IP profits, not all revenue from an innovative business.
Explore Patent Box tax reliefR&D tax relief questions from Leeds companies
Does integration with NHS systems qualify?
Routine integration does not. Work may qualify where the project seeks an advance in technology and has to resolve an interoperability, security, performance or other technological uncertainty that was not readily deducible.
Can a regulated medical product still claim?
Potentially. Regulation neither creates nor prevents eligibility. The claim must identify the scientific or technological R&D within the wider regulated programme.
Is the West Yorkshire Investment Zone relief the same as R&D tax relief?
No. They are separate forms of support with different conditions. Location in an Investment Zone does not establish R&D eligibility.
How Lexmore approaches a claim
Lexmore starts with an honest assessment of the project rather than an assumed claim value. We speak with the people who understand the technical work, establish the baseline that existed when the project began, identify the advance being sought and test whether the uncertainties meet the statutory definition.
We work with businesses across the UK and regularly travel to meet clients on site. Where practical, we prefer to see the operation for ourselves, meet the people behind the work and understand how the business develops its products, processes or technology. If an on-site visit would help us understand your R&D properly, we are happy to make that effort. Remote meetings remain available where they are more convenient or appropriate.
Where a claim is supportable, we then map the qualifying activity to the relevant costs, prepare the technical and financial evidence, support the Additional Information Form and work with your accountant on the Company Tax Return. Careful review is built into the process, and support is included if HMRC opens an enquiry into work we prepared.
Sources and further guidance
Unsure whether your project meets the R&D test?
Book a free initial assessment with Lexmore. You will get a straightforward view of the potential eligibility, the scheme and deadlines likely to apply, and what evidence a claim would need. If we do not believe the work qualifies, we will tell you plainly.