PAYE & NIC cap reintroduced
PAYE & NIC cap reintroducedRead more
A new PAYE and NIC cap for the SME payable credit is introduced.
To prevent abuse of the SME payable R&D tax credit, the government announces that it will reintroduce a PAYE and NIC cap on the SME payable credit.
It will be like the cap that was abolished in 2012.
For accounting periods beginning on or after 1 April 2021, the maximum payable R&D tax credit a company can claim will be set at 300% of the company’s total PAYE and NIC liabilities for the period.
Companies who rely on a contract workforce need to consider the impact of this new restriction on their R&D tax credit claim benefit.
This new cap increases uncertainty, as now an SME’s salary bill will also affect the value of its R&D tax credit.
Have you read our blog on the Autumn Budget 2018?