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D1.417 RDEC merged scheme from April 2024

This article covers the RDEC scheme that applies for accounting periods beginning on or after 1 April 2024. For the RDEC scheme that applies for accounting periods beginning before 1 April 2024, see D1.435A.

For accounting periods beginning on or after 1 April 2024¹, a company which carries on a trade may claim an R&D expenditure credit (RDEC) for an accounting period in respect of qualifying R&D expenditure which is deductible in calculating its trading profits for the period². In the case of an insurance company, the qualifying expenditure must be such that it would be allowable if the company were to calculate its BLAGAB trade profit or loss for the period³.

R&D pre-trading expenditure is treated under the normal corporation tax rules as being incurred on the first day of trading and allowed against profits of the first accounting period⁴. This is different to pre-trading expenditure under both the alternative reliefs for R&D intensive SMEs and the SME R&D scheme