Corporation Tax Act 2009 section 1058A

Relevant expenditure on workers

Section 1058A defines how a company calculates its relevant expenditure on workers for the purposes of determining the amount of an SME R&D tax credit under section 1058.

• Relevant expenditure on workers includes the company's own PAYE and NIC liabilities for the payment period, less any amounts already deducted to avoid double counting
• Where the company is connected to another company and uses externally provided workers, it can include an appropriate proportion of the connected company's staffing costs for those workers
• Where the company is connected to another company and has contracted out R&D, it can include the connected company's staffing costs attributable to that contracted-out research and development
• The proportion of a connected company's staffing costs for externally provided workers is calculated by reference to the claiming company's share of total qualifying expenditure on that worker