The government has now consulted on replacing the two existing Research and Development (R&D) schemes for tax relief with a single merged scheme.
R&D tax relief is a government incentive providing companies with tax breaks to encourage investment in innovative projects in the field of science and technology.
Many SMEs are currently claiming a loan under the Coronavirus Business Interruption Loan Scheme (CBILS) or Bounce Back Loans Scheme (BBLS), but they may be unaware of the effect this may have on them claiming R&D tax credits.
The Chancellor announced a £1.25 billion support package to help protect businesses driving research and development that have been hit by the Coronavirus.
HMRC have contacted businesses to confirm their current processes and new updates for R&D claims.
The rate of Research & Development Expenditure Credit (RDEC) will increase from 12% to 13% from 1 April 2020.