
UK product design companies spend serious money on prototypes, testing and new materials. R&D tax relief for product design companies helps you recover part of that cost through your Corporation Tax return. We work with design-led businesses that build physical and digital products, from consumer electronics to furniture and medical devices, and we see many leaving money unclaimed simply because the rules look confusing.
Below is a simple and practical guide tailored to UK product design companies. It acts as a clear roadmap to help you prepare, structure, and submit a successful R&D tax relief claim.
HMRC only gives R&D tax relief where you try to achieve an advance in science or technology and tackle genuine technical uncertainty.
For product design companies, typical qualifying work might include:
Work that is mainly cosmetic (colour changes, styling tweaks, packaging design without technical change) usually does not qualify. Routine updates, bug fixes, and standard CAD drafting also sit outside the rules. You must be a UK company within corporation tax to claim.
For accounting periods beginning on or after 1 April 2024, most companies claim under the merged R&D Expenditure Credit scheme. This gives a taxable expenditure credit equal to 20% of qualifying R&D spend, which is then subject to corporation tax, giving an effective benefit of around 15–16.2% for many companies.
Loss-making, R&D-intensive SMEs (spending 30% or more of total costs on R&D) may instead claim under Enhanced R&D Intensive Support (ERIS), with a potential cash benefit of up to 27% of qualifying costs.
If your accounting periods begin before 1 April 2024, older SME and RDEC rules may still apply for those years.
HMRC expects you to group work into clear “projects”. For a product design company, you might treat each of these as a project:
For each project, identify:
This narrative will feed directly into the technical sections of your R&D claim for product design companies.
Under the merged scheme, typical qualifying R&D costs for product design companies include:
For product design teams, that often means:
Keep time-records, project codes and purchase descriptions tight enough to link each cost to a specific R&D project. This is vital in case HMRC opens an enquiry. Around 20% of claims now face some form of compliance check.
Two extra steps now catch many companies out:
Apex Accountants helps product design companies set up an annual timetable so these steps never get missed.
Your R&D claim is made through your Company Tax Return (CT600).
Key points:
Given HMRC’s increased scrutiny and recent use of data-driven risk checks, well-structured documentation is essential.
From reviewing R&D claims across the design sector, we see the same errors:
Cleaning these points up before submission greatly reduces the risk of enquiry and protects cash flow.
Apex Accountants works closely with UK product design companies to:
If you want to turn your product development spend into a reliable R&D benefit, rather than a one-off “lucky claim”, talk to Apex Accountants before your next year end.
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