How Design & Creative Companies Can Benefit from R&D Tax Credits for Creative Businesses

Design and creative businesses are at the forefront of innovation, constantly pushing the boundaries of technology to develop new solutions, enhance existing products, and drive creative progress. Organisations such as the Design Council continue to highlight how design-led innovation contributes to business growth across the UK. However, many of these companies may not be aware that they are eligible for significant tax relief under the UK’s Research and Development (R&D) tax credits scheme. At Apex Accountants, we specialise in helping designers and creative businesses navigate the complexities of R&D tax relief. With over 20 years of experience, we offer tailored advice to ensure that you fully benefit from the R&D tax credits for creative businesses. Our team understands the unique challenges creative firms face and dedicates itself to helping you optimise your claims.

This guide helps you maximise eligibility for relief in 2026, despite major R&D scheme updates in 2024. We explain how creative firms qualify for R&D tax credits. Learn about applicable activities, costs, and practical ways to achieve greater tax savings for design and creative projects.

What qualifies for R&D tax relief?

Your firm must undertake work that seeks a scientific or technological advance and involves uncertainty that competent professionals cannot easily resolve.
For design and creative firms, that means:

• Developing new digital design tools or bespoke software to drive creative workflows.
  
• Testing novel materials, processes or techniques in a way that goes beyond standard professional practice.
  
• Prototyping solutions where outcomes are uncertain and require technological experimentation.
  

Pure aesthetic design, artistry, social science or marketing concepts alone do not qualify.

Key changes from 1 April 2024 – the merged R&D scheme

From accounting periods beginning on or after 1 April 2024, the prior SME and RDEC schemes are replaced by the new merged R&D scheme for most companies.

Key features for design and creative firms:

• A standard tax credit of 20% of qualifying R&D expenditure under the merged scheme.
  
• For loss‑making, R&D‑intensive SMEs (those with at least 30% of total spend on qualifying R&D for periods from 1 April 2024), there is a separate “ERIS” route: an additional relief deduction of 86% on qualifying costs and a payable credit of 14.5% of the surrenderable loss.
  
• Overseas subcontracted R&D and use of externally provided workers (EPWs) outside the UK face significant new restrictions from 1 April 2024.
  

What costs can you claim?

Eligible costs include:

• Staff salaries and employer NIC contributions for those directly engaged in R&D tasks.
  
• Consumables and materials used up in R&D.
  
• Software and cloud costs used exclusively for R&D (cloud and data licences included for periods from April 2023).
  
• Subcontractor payments where R&D is contracted out within the UK and the claimant controls the R&D decision‑making.

Design firms should keep detailed time records, project logs and allocation of costs to specific R&D activities.

How design & creative firms can optimise claims

To ensure your firm receives the full benefit of R&D tax relief for design companies, follow these tips:

• Identify each project that developed novel design tools, new materials or bespoke software.
  
  
• Record the technical or technological uncertainty and explain what you did that professional designers could not easily work out.
  
• Ensure subcontracted or outsourced work is managed correctly using UK-based subcontractors with defined R&D tasks.
  
• Review your accounting period: if you begin your period before 1 April 2024, you may still use older schemes. If your accounting period begins after 1 April 2024, use the merged scheme.
  
• Liaise early with your advisers to decide whether the ERIS route applies (if you are an R&D‑intensive SME).
  
• Prepare the necessary disclosures by submitting any required claim notification and filing the Additional Information Form (AIF) with your tax return for accounts ending after 1 August 2023
  

How Apex Accountants Supports R&D Tax Credits for Creative Businesses

At Apex Accountants, we specialise in helping design and creative businesses claim R&D tax relief for design companies. Our team guides you through every step, from identifying qualifying activities to compiling necessary documentation. With 20+ years of experience, we offer expert advice to ensure your claims are accurate and compliant with HMRC requirements.

We guide you through every step of the process, from mapping your costs to qualifying R&D activities to managing subcontractor issues. We aim to provide a robust claim, backed by thorough documentation that can withstand any scrutiny from HMRC.

Design and creative firms are well-positioned to benefit from R&D tax relief if they are engaged in genuine scientific or technological advancement. With the merged scheme starting from 1 April 2024 and stricter rules, especially regarding overseas work, early planning is essential.

Contact us today to learn how we can help you benefit from tax savings for design and creative projects and support your innovation investments.