The official definition set out in the Department for Business, Energy & Industrial Strategy’s (BEIS) Guideline s that R&D takes place for tax purposes when a project seeks to achieve an advance in science or technology through the resolution of scientific or technological uncertainty.
This definition means that, as well as scientific research, R&D can also include development work and design and engineering that involves overcoming difficult technological problems – for example, creating new products or processes or improving existing ones. In addition, the following may also qualify as R&D:
- Attempts to replicate a particular advance in science or technology which has already been made or attempted but where the details are not readily available (for example because it is a trade secret) – but not routine copying, analysis or adaptation of an existing product, process, service or material.
- Work which takes place alongside production which seeks to improve, optimise or otherwise resolve uncertainties.
- Unsuccessful projects – R&D can still take place where the advance in science or technology sought by a project is not achieved or fully realised – indeed, that demonstrates the existence of uncertainty.