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This guidance note provides information on the R&D reliefs available specifically to companies which are small and medium sized enterprises (SMEs). The definition of an SME is detailed in the Research and development (R&D) relief ― overview guidance note. The Qualifying expenditure for R&D tax relief guidance note provides information on what expenditure qualifies for SME relief.

See also Simon’s Taxes D1.419, D1.420.

For accounting periods beginning on or after 1 April 2024, SMEs can claim relief for qualifying R&D expenditure under the merged RDEC scheme. See the Research and development expenditure credit (RDEC) guidance note. Only loss making SMEs which meet an R&D intensity condition can claim the more generous SME reliefs described in this guidance note. This is sometimes referred to as the ‘SME intensive scheme’ or ‘ERIS’ (enhanced R&D intensive support).

For accounting periods beginning before 1 April 2024, SMEs can claim RDEC only for contracted out, subsidised or capped expenditure by SMEs that does not qualify for the SME scheme. Otherwise, SMEs can only claim for relief under