CIRD89750 | R&D Tax reliefs: R&D expenditure credit (RDEC) scheme: R&D contracted to a SME
From HM Revenue & Customs · Corporate Intangibles Research and Development Manual
Chapter 6A CTA 2009 S104C to E
See CIRD81470
To qualify under the expenditure credit scheme the R&D must be contracted out to the SME by:
a large company, or
any person otherwise than in the course of carrying on a chargeable trade. (A chargeable trade is a trade, profession or vocation carried on wholly or partly in the United Kingdom, the profits of which are chargeable to income tax under Chapter 2, of Part 2 of ITTOIA 2005, or chargeable to corporation tax under Chapter 2 of Part 3 of CTA 2009)
The expenditure must be relevant R&D for the SME (CIRD81400) and be revenue expenditure incurred on either:
consumable items CIRD82300,
software CIRD82500,
staffing costs CIRD83000,
externally provided workers CIRD84000,
subjects of clinical trials CIRD84400.
Or, work contracted by the SME company to be directly carried out by:
a qualifying body (see CIRD82200), or
an individual, or
a partnership, each member of which is an individual.