R&D Tax Credit Calculator 2025/26
Estimate your UK R&D tax credit under the merged HMRC scheme (from April 2024). See RDEC credit, ERIS payable credit for intensive SMEs, qualifying cost breakdown by category, and cash flow timeline. Updated for 2025/26.
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How to Use This Calculator
R&D Credit Estimate tab
The default tab. Enter your qualifying R&D expenditure and total company expenditure to see your estimated credit. Toggle whether your company is profitable or loss-making — this determines whether you receive a tax saving against your corporation tax bill or a payable credit from HMRC. Loss-making SMEs with R&D intensity of 30% or more qualify for the enhanced ERIS scheme at 27%.
What Counts? tab
Break down your R&D spend by category: staff costs, subcontractors, consumables, software, and cloud computing. The calculator shows what percentage qualifies in each category and your total qualifying expenditure. Subcontractor costs are capped at 65% for unconnected third parties, but 100% for connected parties (group companies).
Cash Flow Impact tab
See when you receive the benefit. Profitable companies get their credit as a reduction in their corporation tax bill at the CT payment deadline. Loss-making companies receive a payable credit from HMRC, typically 2–4 months after filing the CT600. Enter your financial year end to see exact deadlines.
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The Formula
The merged R&D scheme (from April 2024) uses an above-the-line expenditure credit:
Gross RDEC = Qualifying R&D Expenditure × 20%
Net benefit = Gross RDEC − Corporation Tax on RDEC
If profitable (25% CT rate):
Net benefit = Qualifying Expenditure × 20% × (1 − 25%) = 15%
If small profits (19% CT rate):
Net benefit = Qualifying Expenditure × 20% × (1 − 19%) = 16.2%
ERIS (loss-making SMEs, R&D intensity ≥ 30%):
Payable credit = Qualifying Expenditure × 27%
R&D intensity is calculated as qualifying R&D expenditure divided by total company expenditure. Companies must reach 30% to qualify for the enhanced ERIS rate.
Subcontractor costs: only 65% of payments to unconnected (third-party) subcontractors and externally provided workers qualifies. Connected parties (group companies) qualify at 100%.
Example
TechCo Ltd — Software Development, London
TechCo is a profitable SME with £500,000 total expenditure, of which £120,000 is qualifying R&D spend (24% R&D intensity). They pay corporation tax at the 25% main rate.
R&D Credit Calculation (Merged Scheme)
Cost Breakdown
TechCo files the Additional Information Form (AIF) and then the CT600 with R&D claim by 31 March 2027. The £18,000 credit reduces their CT bill, saving cash at their payment deadline of 1 January 2027.