Does Having a Coronavirus Business Interruption Loan (CBIL) Affect My R&D Tax Credits Claim?

Yes, having a CBIL can affect your R&D tax credits claim.

CBILs can impact your R&D tax credits claims. Let's explain how.

What is the Coronavirus Business Interruption Loan scheme?

To support businesses relying on R&D tax credits claims, the CBIL scheme provided government backed loans through the British Business Bank to SMEs around the UK. These loans were up to £5 million, and while recipients remained fully liable for the debt, they were not required to pay interest for the first 12 months of the loan. 

The deadline for CBIL applications closed on 31 March 2021.

What impact will a CBIL have on my claims? 

Took out a CBIL and are wondering whether this will affect your R&D tax credits claim? Well, the answer depends on certain criteria.

If you have a CBIL and use the funds in an area that isn't related to your claim, then your projects won’t be affected.

If you use it to fund your projects (in full or part), all CBIL-supported R&D must claimed under the RDEC scheme. 

How much can I claim in R&D tax relief? 

A CBIL is considered notified state aid, which means RDEC rules apply. 

RDEC rules are usually for large companies, however, in certain cases SMEs can be affected, too. Under this scheme you can claim around 11p of every £1 of qualifying expenditure on R&D projects.

Let’s have an honest chat about your R&D tax claims 

At RDvault, our transparent, low cost service makes worrying about R&D tax credit claims a thing of the past. Need more information on how a CBIL may impact your claim, or how we can support you best? Simply get in touch and we’ll be happy to help.