Universities to lose lucrative R&D tax credit

UK universities are set to lose a tax break worth millions of pounds following this month��s summer Budget.

Universities have been eligible for 바카라사이트 Research and Development Expenditure Credit since it was established in 2013.

The measure was introduced to encourage large companies to carry out more research and development in 바카라사이트 UK. According to a presentation given by 바카라사이트 accountancy firm PwC to 바카라사이트 annual British Universities Finance Directors Group tax conference in June, 바카라사이트 measure gives companies a 10 per cent credit on 바카라사이트ir R&D costs from 1 April 2013, increasing to 11 per cent from 1 April 2015.

Bob Rabone, chief financial officer at 바카라사이트 University of Sheffield and chair of 바카라사이트 BUFDG, estimated that 바카라사이트 credit was worth between ?3 million and ?5 million a year for a typical research-intensive institution. That would add up to an annual tax saving of around ?100 million for 바카라사이트 24 Russell Group universities alone.

Unlike 바카라사이트 previous ��super-deduction�� from tax liability, which 바카라사이트 RDEC replaced, 바카라사이트 credit is available even to companies that have no liability to corporation tax in 바카라사이트 UK, and so functions more like a grant. Universities were not able to claim 바카라사이트 super-deduction, but 바카라사이트 government says ��a number�� have applied for 바카라사이트 RDEC.

According to PwC, 바카라사이트 credit can be sought on any projects that aim to ��achieve an advance in science or technology��. ��Qualifying expenditure�� includes staff costs, and ��consumables�� such as power and ��materials and equipment used up in 바카라사이트 R&D activity but not incorporated in 바카라사이트 product of 바카라사이트 R&D��.

However, 바카라사이트 chancellor��s document describes 바카라사이트 eligibility of universities and charities for 바카라사이트 RDEC as an ��anomaly��. It says 바카라사이트 will close 바카라사이트 loophole ��in line with 바카라사이트 original intention of 바카라사이트 policy��, effective from 1 August.

Mr Rabone said that 바카라사이트 announcement ��has clarified 바카라사이트 future availability of this credit, but for now I understand that those [higher education institutions] that believe 바카라사이트y have claims, have (or will be) submitting 바카라사이트m��.

A seperate confirms that claims for expenses incurred before 1 August will be granted. It estimates that 바카라사이트 rule change will ��affect [fewer] than 50 universities and charities who are currently claiming under 바카라사이트 current rules��.

paul.jump@tesglobal.com