Can a company that is limited by guarantee, submit an R&D tax credit claim?

A company limited by guarantee can submit an R&D tax credit claim if it meets the standard eligibility criteria created by HMRC.

R&D tax relief is a form of Corporation Tax relief available to UK companies undertaking qualifying research and development activity. The relief is linked to Corporation Tax because it operates through the company tax system. For that reason, eligibility is determined by whether a company is within the UK Corporation Tax regime rather than by its legal structure.

Companies limited by guarantee are still corporate entities registered at Companies House. They can be liable for Corporation Tax if they generate taxable income. This means they can access R&D for tax purposes in the same way as companies limited by shares, provided the other requirements are met.

To qualify, the company must carry out projects that seek an advance in science or technology. The work must involve resolving scientific or technological uncertainty that could not readily be solved by a competent professional working within the current baseline knowledge of the field. The company must also incur eligible expenditure such as staff costs, software, subcontractor costs, or consumable materials directly linked to the R&D activity undertaken.

Where these conditions are satisfied, a company limited by guarantee can submit an R&D claim through its Corporation Tax return.