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R&D Tax Credits for Arts, Entertainment and Recreation

You don’t need us to remind you of the devastating impact COVID-19 has had on the UK’s arts, entertainment and recreation sector. There’s a long road to recovery, and the key lies in the government’s lucrative research and development (R&D) tax credits scheme

We know what you’re thinking: it’s just for businesses in the scientific and technology fields. At first glance, it would seem that the government’s definition of R&D contradicts your eligibility for any R&D Tax Credits, with its request for “an advance in science or technology”.

HMRC’s criteria would seem to exclude any artistic, creative and recreational pursuits outright. That’s why so many companies in your sector are missing out. They discount the possibility of being eligible for R&D tax credits from the get-go. Many that are claiming are drastically underclaiming. 

Believe it or not, R&D in arts, entertainment and recreation is rife, and there’s plenty of scope to claim R&D tax credits — whether that be in the form of a lump sum or a reduced tax bill. Claims can quickly mount up, and we’ve even helped clients reduce their corporation tax bill to zero.

It’s all about looking at what you do from a slightly different angle, which is where we come in to ensure no eligible costs go amiss or are underclaimed.  

Even if your project completely fails, the scheme can still reward you in R&D tax credits for the attempt.

car spanners

Automotive projects that may qualify for R&D tax relief include:

  • Alternative fuels and improved fuel formulas
  • Manufacturing and assembly strategies and techniques to scale up engineering prototypes to enable production at full rate
  • Lightweight car engines that are significantly more powerful, without compromising safety, reliability, and performance
  • Developing race cars using CFD techniques, e.g. modelling and analysis of existing cars, changes through previous baseline analysis, subsequent iterative improvements via analysis, patterns, moulds, and components to complete testing and validation
 

Key questions on R&D tax relief answered

What activities can be included in a R&D project?

  • Defining technical objectives
  • Identifying uncertainties
  • Feasibility studies, reviewing new and competing technologies
  • Analysing, designing and developing the technology
  • Producing technical specification or other documents to explain and support the R&D project and advancement
  • Testing the product, process, service or software
  • Planning and managing projects
  • Administration, finance and personnel services specifically required to support R&D activities
  • Training to support R&D

What expenditure can be claimed for in a R&D project?

  • Staff Costs – Employee costs (salary, national insurance and employer pension) are apportioned for their time spent on the R&D project plus any reimbursed associated business expenses
  • Software – Purchased for R&D purposes and costs apportioned for any subsequent use
  • Subcontracted R&D – You can claim 65% of what you paid your R&D subcontractor
  • Utilities & Consumables – Water, fuel, power and material used in the project
  • Prototypes – Produced for R&D purposes

About Easy R&D’s R&D tax credit claim process

Claiming R&D tax relief is a niche.

Here at Easy R&D, we’ll probe your company’s activities to reveal the true extent of your company’s R&D.

Averaging £54,000 per claim, we’re a business built around expert tax professionals, skilled technical report writers, and flawless processes to ensure your R&D claims are successful — with maximum return. You could even reduce your corporation tax bill to zero.

HMRC’s criteria for claiming is purposefully broad, so what qualifies may surprise you.

 

Interested in claiming R&D tax credits?