R&D claim received from HMRC for SMEs is not taxable and will use to reduce current year tax liability. What if the claim amount is more than current year tax liabilities?
You can either choose to carry the additional losses forward to future tax years where you can offset it against future profits at a rate of 19% or you can choose to cash in your losses for a repayable tax credit equal to 14.5% of the total losses you've created.
ok thanks what about that 14.5% received. Is it taxable? how to treat it?
Dr CT (BS)
Cr Tax (P&L)
Cr CT (BS)