Are clinical trials eligible for R&D tax relief claims?

There has been much discussion recently about whether the UK is going to be able to keep pace with R&D on a global scale.

This conversation has been sparked by an apparent exodus of pharmaceutical companies from the country.

However, a new report seems to indicate that clinical trials are becoming more prevalent in the UK.

If you work alongside clients that are pushing the future of medicine with clinical trials, it is imperative that you understand how to support them to get the most out of their R&D tax relief claims.

How are clinical trials handled in R&D tax relief claims?

With recent reports showing a gradual increase in the number of industry trials initiated in the UK, we can expect to see more R&D tax relief claims that centre on clinical trials being submitted in the next few years.

Clinical trials are going to be one aspect of a wider project that will be seeking to develop a medical advance.

While the most obvious type of advance will be the development of new pharmaceuticals, this is not the only thing that requires clinical trials.

New medical equipment, technology and practices could all require clinical trials to determine the efficacy of the development.

In fact, if innovative companies follow the advice of the World Health Organization (WHO), it may become more common for non-pharmaceutical medical advances to be sought.

This is because the WHO found that research into cancer was currently “disproportionately focused on novel drugs, while surgery, radiotherapy, diagnostics and palliative care remain underrepresented.”

As such, when handling clinical trials in an R&D tax relief claim, it is vital to frame them in terms of the specific medical advance being sought.

It should be apparent what condition, illness, or ailment the advance seeks to cure or alleviate and how the clinical trial is set up to achieve this.

What parts of clinical trials are eligible for R&D tax relief claims?

One of the types of qualifying expenditure for R&D is the payment of clinical trial volunteers.

This means that R&D tax relief claims could improve the quality of medical research by allowing for a broadening of the demographic net that the researchers cast.

If the researchers can reduce financial barriers by compensating clinical trial volunteers for their time, it may result in a more diverse sample size and more definitive evidence of the efficacy of the advance.

This would be coupled with other qualifying expenditure, such as the salaries of staff involved in R&D and the cost of consumable materials that are irreversibly changed, damaged, or destroyed by R&D.

If the UK wants to continue to be a global R&D powerhouse, the companies involved in research must leverage all funds available to them.

R&D tax relief claims allow businesses to be more ambitious as they provide a financial buffer that means costs that would otherwise be challenging to recover are reinvested back into innovation.

We want to help accountants unlock their clients’ full potential and will be working closely to support the next wave of medical research.

Our team of R&D tax consultants are on hand to support maximised, eligible R&D tax relief claims so that you can better support your innovative clients.

Speak to our team today for specialist R&D tax relief claim support!

Adam Bointon