No, there is no minimum amount of expenditure needed to claim for R&D tax credits. But that wasn’t always the case. Before April 1st 2012, HMRC required that claims had a minimum R&D expenditure of £10,000. For that reason, you might still see some articles online with this minimum claim figure still showing.
We do advise however that you consider whether it’s worth compiling a claim if you have spent less than £10k on qualifying R&D work in the past financial year. Compiling a claim for any amount of money will require you to split out your R&D costs from your overall business costs, and write a technical narrative explaining how your R&D activities can meet HMRC’s standard for research and development.
You should also consider how much you are due to receive back from your claim before deciding whether to compile the report. The maximum you can receive back from the SME scheme is 33%, however, this can be reduced if you’ve received a grant, spent money on subcontractors or need to claim through the RDEC scheme.
When to submit your own claim, and when to use a specialist
We recommend using a specialist R&D consultancy when your costs exceed £50,000. If you;ve calculated that your R&D costs are below £50,000, then we recommend using the government’s own guide to self-filing an R&D tax credit claim. There are of course additional resources online, including our own Introduction to R&D Tax Credits.
If you’ve spent more than £50,000 on R&D then it will begin to make sense to use a specialist to help with your claim. That’s because HMRC will apply more scrutiny to your claim report, and it’s more likely that you’ll undervalue your R&D expenditure. We offer a free consultation to help you understand your eligibility and identify your allowable costs. To get started, speak with one of our team here.