R & D CT Credit

How do we exactly post R & D tax credit in the accounts.  detail if possible..   Thanks.

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brendanm's picture

R & D

brendanm | | Permalink

Presumably you have gotten a refund of tax after submitting the claim, is that correct? Then you will debit the bank and credit the tax in the profit and loss account. Your tax note will be adjusted to reflect this so that the note and the charge are in agreement. The narrative in the tax note would probably come under the description "R & D tax credit relief".

It is similar to the treatment you would have if you carried a loss back to a previous accounting period. Say you were doing the 31 March 2011 acccounts and there was a significant loss. If the 2010 accounts showed a profit, you might have been able to carry these losses back. In the 2012 accounts, this refund would have arrived and thus you would follow the same treatment as the R & D tax credit relief.

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