Claiming R&D For Software Development
Software development plays a pivotal role in driving the UK's digital economy forward, and initiatives in this field make up a 26% share of claims under the R&D Tax Credit scheme.
From building bespoke software solutions for clients to creating and commercialising proprietary digital products or platforms, we examine the key criteria for eligibility and outline practical steps to construct a strong, compliant claim.
It is also one of the most heavily scrutinised by HMRC, which is why it is vital to work with a trusted advisor who can identify which projects are eligible.
Software development qualifies as R&D for UK tax relief when it:
Seeks an advance in computer science or software engineering.
Involves resolving technological uncertainties that competent experts cannot easily overcome with existing knowledge.
Examples that can qualify:
Creating novel algorithms, architectures, or frameworks.
Innovative integration of emerging tech (e.g., AI, ML, advanced cloud).
Achieving breakthroughs in performance, scalability, security, or efficiency through experimentation.
Systematic prototyping, testing, or analysis to overcome specific technical barriers.
What usually does not qualify:
Routine coding, customisation, or bug fixes using standard methods.
Implementing off-the-shelf technologies without innovation.
Purely commercial or market-driven features with no technical advance.
How we partner with you
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Discuss to understand which government incentives are applicable today, and could be applicable in future.
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Identify the relevant periods available for a claim and discuss the relevant projects in detail to understand where the technical uncertainty and subsequent advancements is.
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Create a compliant technical narrative justifying how the project(s) meet the eligible criteria and associate the relevant qualifying expenditure to the relevant project(s)
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Given our expertise in understanding the ever-evolving R&D legislation, we offer a enquiry defence service. Where we will comprehensively review the claim in dispute, the case HMRC have put forward and if viable, defend the claim in question.
