How have the payable R&D rates changed as of 1 April 2023 onwards?
Rate changes in R&D tax relief rates came into effect on 1 April 2023. The Research and Development Expenditure Credit (RDEC) rate increased from 13% to 20% for large companies. However, small to medium-sized enterprises (SMEs) unfortunately actually experience a decrease in their additional deduction from 130% to 86% and a general decrease in the SME credit rate from 14.5% to 10%.
| SME Scheme | RDEC (Large company) Scheme | |
| Dates | Up to: 31 March 2023 From: 1st April 2023 | Up to: 31 March 2023 From: 1st April 2023 |
| Profitable | 130% uplift = 24.7% net tax benefit 86% uplift = up to 21.5% (1) net tax benefit | RDEC at 13% = 10.5% after tax RDEC at 20% = 15% (1) after tax |
| Loss-making | 33.4% credit 18.6% credit 27.0% credit (2) | 10.5% credit 15% credit |