Corporation Tax Act 2009 section 104I

Capped R&D expenditure

Section 104I defines the meaning of "capped R&D expenditure" for SME companies, identifying which research and development costs are treated as capped and therefore subject to specific restrictions on relief.

• Capped R&D expenditure covers costs that cannot receive SME relief because they exceed the cap on R&D aid
• The cap on R&D aid is set out in section 1113 of the Corporation Tax Act 2009
• Expenditure that would otherwise qualify as large company R&D expenditure for the relevant accounting period also falls within this definition
• This definition is relevant for determining how SME companies claim relief on R&D spending that exceeds the permitted SME thresholds