Proposals include changing the definitions to allow advanced ‘bought in’ computer software used in research and development to qualify and cover the term ‘consumable stores’ used up during an R&D process.
The proposals follow an earlier decision to allow software written by a company’s own staff in support of an R&D project to qualify for an R&D tax credit – even where the development of the software would not itselfqualify.
The join document says the government is willing to change the rules to include the software – but want industry’s views on how the new rule should be defined to ensure it covers ‘advanced’ software which is ‘consumed’.
The R&D relief was brought in for small and medium sized companies in 2000 and extended to large companies in 2002.
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Unincorporated businesses under the VAT threshold given an extra year to prepare before MTD becomes mandatory