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Research and development

For the purposes of R&D allowances, research and development means¹:

1. Ìý

   (a)ÌýÌýÌýÌý activities which fall to be treated as research and development in accordance with generally accepted accounting practice; and

2. Ìý

   (b)ÌýÌýÌýÌý oil and gas exploration and appraisal.

The accounting standards that deal with research and development are FRS 102, section 18, FRS 105, section 13 and IAS 38. For the meaning of generally accepted accounting practice generally see B2.102.

The definition of research and development is extended by Treasury regulations². The regulations are in the form of guidelines titled 'Guidelines on the Meaning of Research and Development for Tax Purposes', the current verstion of which was issued by the Secretary of State for Trade and Industry in 2004 and updated in 2010 and again on 7 March 2023. For commentary on the guidelines (now know as the BIS or BEIS guidelines), together with the full text, see D1.403A.

Expenditure on R&D includes all expenditure for carrying