R&D Tax Credits for Architecture

Select a topic you want to learn about:

• Do your architecture projects qualify?
• Typical examples of qualifying projects
• Costs that you can and cannot include in your claim
• Tips for maximising the value of your architecture claim
• Frequently Asked Questions

1. Do Your Architecture Projects Qualify?

The first stage in claiming R&D Tax relief in architecture is determining to what degree valid R&D is being performed and to assess which field of science or technology the claim would fall under.

Completed projects that took place in the previous two financial years should also be looked at because claims can be made retrospectively for that period.

Broadly speaking, if an architectural project includes any unique adaptations, non-standard elements (structural, materials used etc.) or has faced particularly difficult technical challenges, then it should be examined more closely for eligibility. HMRC sets out two main requirements for a project to be considered as R&D for tax purposes:

1.1. Seeking to achieve a technological or scientific advance

An eligible project or activity should theoretically add to the current pool of technical or scientific knowledge in architecture. The advance in knowledge would not necessarily need to involve tangible assets but can also involve design or process improvements. Note: Any intellectual property that is included in a claim would remain protected throughout the claims process and does not need to be shared publicly.

1.2. Overcoming a level of technological uncertainty

In other words, it is not known at the outset if the solution to a technical challenge was either possible, or alternatively, how in practice to achieve it. Even if someone else in the industry has already achieved the same thing, you can still potentially make a claim if the solution is not in the public domain and not obvious.

The Eligibility Threshold

In architecture, the above two criteria are often met as a result of environmental factors affecting the desired solution, such as thermal performance, structural characteristics, or specific materials and may subsequently require new and appreciably improved processes or solutions that will in turn qualify for the R&D relief.

It is also important that no non-qualifying activities are included within the claim and this is something that can often be challenging, as these are rarely tracked separately within a project. When making a case to HMRC as to why the work qualifies, we will work with you to ensure that only the eligible activities have been accurately costed and included in the claim.

Related article: Avoiding an HMRC enquiry when making an R&D claim

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2. Examples of Architectural Projects that qualify for the R&D scheme:

Below we explore just a few scenarios of how architecture firms can become eligible for the R&D tax credit scheme. If you are unsure of your eligibility or would like further information, you are welcome to contact us for an objective assessment at no obligation to you.

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3. Costs that you can and cannot include in your claim

In architectural projects typical costs that are included in an R&D claim are:

• Pro-rata salaries of employees over the period where they worked on eligible activities
• Sub-contractors hired by the architecture firm to carry out eligible activities. These could include engineering firms, environmental consultants, fire-safety experts etc.
• Costs of materials that contributed to the eligible project
• Software licences used within the bounds of the eligible activities

Costs that cannot be included are:

• The running costs of the business (rent, electrical, travel costs etc.)
• 3rd party costs that are recharged back to clients

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4. Tips for maximising the value of your architectural claims

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5. Frequently Asked Questions

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Innovation Plus have an outstanding record in successfully claiming R&D tax relief in architecture and have developed a tried and tested process that maps the industry-standard RIBA stages onto the R&D Tax legislation. In this way, we are able to use the information that you are already tracking to support and secure a successful R&D tax claim that yields the maximum value for your firm.

Contact us here if you have any questions or if you would like us to scope out your eligibility and estimated claim value, without any obligation.