Are there any implications to claiming R&D tax credits if you secure the Innovate UK Loan?

Capti Innovation has supported multiple companies with their applications for Innovate UK’s Innovation Loans.


Over the years, we’ve developed a breadth of knowledge from advising these corporations on all aspects of securing the loan.


The Innovation Loan has huge benefits and Innovate UK is set to proceed releasing a number of these competitions, but, are there any implications to claiming R&D tax credits if you secure the Innovate UK Loan?


Consider your tax position


Firstly, it is absolutely important to ensure that your tax position is regarded and planned before the Innovation Loan is applied for; otherwise, the tax credit position could be adversely affected by a role that is already ‘fixed’ by the time the claim is made.


Clearly define your project


As the Innovation Loans supplied by IUK are classed as state aid, the R&D tax incentives can only be claimed below the RDEC scheme for the eligible costs on the relevant project for which the loan is received. Therefore, it is important to ensure that the project is honestly defined so that the costs of that project can be ring-fenced and remoted from other costs which could nevertheless qualify for R&D tax credits under the more really useful SME scheme.


When considering the Innovation Loan, the cost of ‘lost’ tax credits need to also be weighed up (i.e. by virtue of forgoing an SME declare for an RDEC claim) against the benefits of obtaining finance which is finally repayable, as opposed to a grant.


We’re here to help


Capti have experienced bid writers who show innovation and have FD-level financial forecasting capabilities to prepare strong Innovation Loan applications and claiming R&D tax credits. Talk to one of our team today to supply your business the best chance of securing funding.Reach Out


If you have a disruptive enterprising project or innovation, why not contact us? A brief chat with one of our innovation consultants will help you determine whether grant funding could get your project off the ground.


Why use grant funding experts?


Although there are many benefits to seeking grant funding, the thought of applying can be confusing, time-consuming and stressful. Using the creative and technical skills of a professional Innovation grant writing consultancy will strengthen your business in translating technologies and business models into a language and format assessors understand; increasing the chance of success. If you have a disruptive ambitious project or innovation, why not contact Capti Innovation.