RDEC is primarily aimed at:
RDEC is the only available scheme for these types of businesses and is governed by distinct rules on qualifying activities and costs.
To qualify for RDEC, a project must meet HMRC’s definition of R&D:
FI Group provides detailed technical assessments to identify all eligible activities and ensure that your RDEC claim is complete and compliant.
The RDEC is a taxable credit, usually calculated at 20% of eligible R&D expenditure. It is accounted for above the line and then used to reduce the company’s corporation tax liability.
This makes RDEC a highly valuable mechanism for recouping investment in innovation, particularly for businesses operating at scale.
As of April 2023, the RDEC rate increased to 20%, and changes to subcontracting and overseas R&D came into effect from April 2024 under the new Merged R&D Scheme. These changes will ultimately replace both RDEC and the SME scheme for most companies.
Until then, companies that remain under RDEC can continue to claim but must prepare for the transition. FI Group offers guidance on managing this change, ensuring that your claims are forward-looking and aligned with future legislation.
FI Group brings a unique combination of scientific, technical, and tax expertise to each R&D tax relief project. Here’s how we can support you:
FI Group brings a unique combination of scientific, technical, and tax expertise to each R&D tax relief project. Here’s how we can support you:
RDEC FAQs
The R&D Expenditure Credit (RDEC) is a UK government incentive designed to encourage large companies and certain SMEs to invest in research and development. Unlike the SME scheme, RDEC operates above the line in the accounts, meaning it appears as income in the profit and loss statement and is visible to shareholders and stakeholders. For accounting periods beginning on or after 1 April 2023, the RDEC rate increased from 13% to 20% of qualifying R&D expenditure.
At FI Group, we help large companies and SMEs ineligible for the SME scheme navigate RDEC claims efficiently, ensuring compliance with HMRC guidance while maximising relief. With experienced consultants, including engineers and PhDs, and a presence across the UK and in 20 countries worldwide, we offer both local insight and global strategy.