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Ultimate guide on tax relief reforms

R&D Tax Credit Timeline: Reforms & Changes

The R&D tax credit scheme has undergone significant changes over the years. See a list of key reforms & changes from 2000 to the present.

2024
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1 April 2024

Merged R&D scheme commences

For accounting periods starting on or after 1 April 2024, the old SME scheme and RDEC scheme merge into a single Merged RDEC. This unified scheme adopts an above-the-line credit structure and includes new rules on subcontracting, overseas R&D, and subsidised costs.

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1 April 2024

ERIS introduced for R&D-intensive SMEs

The term ERIS (Enhanced R&D Intensive Support) is formally adopted for loss-making, R&D-intensive SMEs (≥30% of costs on R&D), offering a higher payable credit rate than the standard Merged RDEC scheme.

  • Potentially up to 27% back on qualifying costs, depending on trading losses.
  • Lower threshold of 30% R&D intensity (replacing the previous 40%).
2023
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January 2023

HMRC anti-fraud taskforce expanded

In response to rising concerns about inaccurate and fraudulent R&D claims, HMRC announces increased funding and personnel dedicated to scrutinising claims more thoroughly.

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1 April 2023

New R&D rates in effect

The revised SME and RDEC rates, announced in Autumn 2022, officially take effect for any qualifying R&D costs incurred on or after this date.

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1 April 2023

R&D-intensive SME relief

A higher payable credit rate (14.5%) is introduced for loss-making SMEs with at least 40% of total expenditure on R&D. (Often informally called ERIS, but the official name applies only from April 2024.)

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Spring Budget 2023

AIF & CNF officially announced

The Chancellor confirms the upcoming requirements for an Additional Information Form (AIF) and a Claim Notification Form (CNF) , aimed at increasing transparency and reducing fraud.

HMRC also highlights a continued commitment to tackling non-compliant claims through expanded compliance checks.

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Spring Budget 2023

Merged R&D scheme proposed

Alongside the AIF & CNF announcements, the government outlines plans to unify the SME and RDEC schemes into a single, simplified R&D scheme from 1 April 2024. A formal consultation is launched to refine details and reduce fraud.

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8 August 2023

Additional information form required

All claimants must submit an AIF with detailed technical and financial information about their R&D activities, as mandated by HMRC.

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8 August 2023

Claim notification form

Companies new to R&D claims (or those who haven’t claimed in 3 years) must now submit a Claim Notification Form (CNF) within 6 months of their accounting period end to confirm their intent to claim R&D tax relief.

2022
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Autumn Statement 2022

Major R&D rate changes announced

The government unveils significant changes to R&D tax relief for both SMEs and large companies. These changes set the foundation for reforms taking effect in 2023 and beyond.

  • SME additional deduction rate drops from 130% to 86%.
  • SME payable credit rate drops from 14.5% to 10%.
  • RDEC rate increases from 13% to 20%.
2020
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March 2020

RDEC rate increased to 13%

The third incremental boost to RDEC, further encouraging large companies (and some SMEs) to invest in innovation.

2019
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April 2019

CT600 & computation made mandatory

HMRC tightens processes, requiring standardized computations and electronic filing for R&D claims.

2018
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January 2018

RDEC rate increased to 12%

This second incremental boost to RDEC raises the net benefit for large-company claims.

2016
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April 2016

Large company super deduction abolished

After running in parallel with RDEC for two years, the older “super deduction” ends, forcing large companies onto RDEC.

2015
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April 2015

SME enhancement rate from 125% to 130%

Profit-making SMEs gain a marginal increase in benefit; loss-makers see a slightly higher payable credit maximum.

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April 2015

RDEC rate increased to 11%

Large companies (and some SMEs using RDEC) get a higher net benefit, up from 10% previously.

2014
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April 2014

SME payable credit rate jumps to 14.5%

A significant uplift for loss-making SMEs (from 11% to 14.5%), raising their maximum benefit to ~32.63%.

2013
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April 2013

RDEC incentive introduced

Research and Development Expenditure Credit (RDEC) is launched, eventually replacing the Large Company Scheme.

2003
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2003

SME scheme minimum spend removed

SMEs are no longer required to exceed a fixed R&D expenditure threshold to qualify.

2002
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2002

R&D tax relief for large companies introduced

Often referred to as the “Large Company Scheme,” laying groundwork for future RDEC.

2000
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April 2000

R&D tax credits launched for SMEs

The first SME scheme is introduced, requiring a minimum spend of £25,000 per accounting period.

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July 2000

Original R&D guidelines published

HMRC publishes the first official guidance on the definition of “research and development” for tax purposes.

About the author

Alex Hannaway

Alex Hannaway is the Content Marketing Manager at EmpowerRD, where he has played a pivotal role for over three years in shaping the company’s content strategy and ensuring it aligns with the latest developments in R&D tax credits. With an in-depth understanding of R&D tax relief, Alex ensures that EmpowerRD’s messaging is accurate, clear, and up-to-date with the latest legislation and reforms. His expertise in creating compelling content helps innovative companies navigate the complexities of the R&D tax credit landscape, positioning EmpowerRD as a trusted partner for businesses seeking to optimise their claims.