What's being compared, and what isn't
Six deliberate reliefs, not the ordinary running costs every company already deducts
Every company already deducts staff costs, rent and the rest of its normal running expenses before profit is even calculated. That's not a "relief" in the sense this page means it. What follows is the set of reliefs a director has to actually know about and, in most cases, actively claim. There's no reliable figure for what a "typical" claim is worth, so this page doesn't quote one.
The comparison
| Relief | What it does | Who it fits | Effort to claim | Worth knowing |
|---|---|---|---|---|
| R&D tax relief | Reduces what you owe HMRC, or pays out, via the merged R&D expenditure credit (or ERIS, for the most R&D-intensive loss-making SMEs). | Companies that have genuinely resolved technical uncertainty. That reaches well beyond software and manufacturing. | Real: a technical narrative, a cost identification exercise, and a claim notification if you're a first-time or lapsed claimant. | Often the single largest relief on this page for a company that qualifies. The qualifying bar is genuine, though, not automatic. |
| Full expensing / capital allowances | A 100% first-year deduction on qualifying plant and machinery, within the wider capital allowances regime. | Any profitable company investing in qualifying equipment. | Low: largely an accounting classification your accountant already handles. | Not a discretionary claim in the way R&D is: mostly automatic once the right kind of asset is bought. |
| Employer pension contributions | Deducts contributions paid wholly and exclusively for the trade before corporation tax is calculated. | Any company able to make employer contributions for directors or staff. | Low: a payment your accountant records as an allowable expense. | Straightforward, but the tax saved scales only with what you can genuinely afford to contribute. |
| Patent Box | A reduced 10% corporation tax rate on profits from qualifying patented IP. | Companies holding a qualifying patent that is genuinely profitable. | Real: identifying and apportioning the IP-derived profit, usually with specialist input. | A fixed, real rate, but only relevant if you hold patented IP. Most companies don’t. |
| Trading losses relief | Carries a loss back against a prior profitable year, reclaiming corporation tax already paid. | Companies with a loss-making period following a profitable one. | Low-moderate: mostly a Company Tax Return mechanic. | Backward-looking rather than something to plan towards, but genuinely useful if your figures fit the pattern. |
| Charitable donations relief | Deducts qualifying donations (cash, equipment, trading stock, land or shares) from profits before tax. | Any company making qualifying donations to a registered charity or CASC. | Low: entered as a qualifying donation on the Company Tax Return. | Modest next to the others for most companies, but a straightforward addition to whatever else applies. |
Reading the R&D row honestly
Often the biggest relief on the table, and also the most gated
R&D tax relief sits at the top of this list because, for a company that's actually resolved genuine technical uncertainty, it can be the largest single figure here. The relief scales with qualifying spend; the only limit on the cash credit is a PAYE and National Insurance cap (£20,000 plus 300% of the company's relevant PAYE and NIC liabilities for the period, unless it's exempt), with any excess carried forward. But "actually resolved genuine technical uncertainty" is a real gate, not a formality, and it's why the effort column reads differently for R&D than for something like capital allowances, which your accountant applies more or less automatically. A thin, boilerplate technical narrative is a bigger risk with HMRC than a genuinely uncertain but well-documented one, so the effort in that row buys something: a claim that holds up.
Worth checking before you instruct anyone: advisers who interact with HMRC on a client's behalf (which covers preparing and filing an R&D claim for you) now fall under a formal registration requirement under the Finance Act 2026, Part 7 (Schedule 20 sets out the exemptions to it, not the requirement itself). Worth confirming registration status directly with HMRC rather than from an adviser's own marketing, particularly for the higher-effort rows on this table.
Alternatives and limitations
This table compares reliefs against each other. It doesn't tell you whether any of them fit your business specifically; that's a question for your accountant or, for R&D, worth a proper look at R&D Tax Relief. If you haven't yet worked out which lever is even worth investigating, start with the wider survey at Reduce Corporation Tax, which triages by situation rather than laying every option out flat. And if what you actually need is growth capital rather than a smaller tax bill, none of these six reliefs is the right tool: see Invoice Finance instead.
