Corporation Tax Act 2009 section 1068

Additional deduction in calculating profits of trade

Section 1068 allows small or medium-sized enterprises to claim an additional tax deduction for research and development expenditure that has been subsidised.

• Small or medium-sized enterprises can claim relief for subsidised R&D expenditure under Chapter 4 of Part 13
• Relief takes the form of an additional deduction on top of the normal trading expense deduction already made in calculating trade profits
• The additional deduction increases the allowable expenditure by 30% of the qualifying subsidised R&D spend
• Only companies liable to corporation tax may claim this relief