Construction Insider Logo

Construction Insider

Get Access to the Construction Insider Magazine, Saint Sunday and Exclusive tips & tricks to scale your business.

You're all set!

Thank you for subscribing to the No.1 Construction magazine for construction businesses.

Oops! Something went wrong while submitting the form. Please check your email and try again

We Use Cookies! Learn More

Sounds Good!
What software expenses can I claim for R&D?
Construction Insider logo

What software expenses can I claim for R&D?

Day / Night Icon
Construction Insider - Arrow Left
Back to the Toolbox

What Software Expenses Can I Claim For R&D?

Nearly all the R&D Tax Relief claims we process includes some sort of software costs which is hardly surprising, as every business today is using some kind of software to support their business, teams of their jobs. We use software in pretty much every business process we do! This is also the one area in R&D where businesses feel most comfortable in making their R&D claim.

But what you might not know is that when it comes to R&D, software is one big grey area, meaning certain software costs cannot be claimed.

In this blog, we are going to be showing you the fundamental rules when it comes to software and what exactly is this grey area.


The rules around software do look quite straightforward:

  1. If the software has been purchased only to be used in R&D projects, then you can claim 100% of the cost in the R&D claim.
  2. If you use the software for other business activities such as general admin or non-R&D projects, then you will need to calculate an appropriate proportion of the software's cost to be included within your claim.

Sounds simple right? Let's move onto the grey area!


With software, there is often other costs that are involved alongside the software when it is bought from external parties. It is these costs that fall within the grey area. These costs fall under the scope of 'cloud computing' and charges for the whole range of activities including use of software, storage charges and support will need to be verified to see if they can be included within the R&D claim.


Cloud computing and hosting is particularly relevant for businesses that are involved within R&D Projects, especially when related to a development of software. These 'cloud computing' costs unfortunately do not meet the requirements of any of the qualifying criteria to make an R&D claim. It is quite common when businesses purchase software to support their business operations as well as R&D so it is important to track the cost specifically to hosting, the testing and development enviroment when using the services.

The likelihood is you’ll be using software somewhere in your business, and it could impact your R&D claim. Like a lot of R&D categories, software has its grey areas, but that’s what we are here for, we will work with you to ensure you submit an accurate R&D claim.

As we speak new changes are on the horizon to include cloud computing and data costs, but stick with us and we’ll make sure you’re up-to-date as the changes come in.


If you think you might be eligible for R&D Tax Relief, and you’d like to find out more about how we can help you make your R&D claim, please get started here.

Frequently asked questions

Construction Yellow Tag
This Article was included in:

This article has been provided for information purposes only. You should consult your own professional advisors for advice directly relating to your business or before taking action in relation to any of the provided content.

PS. Whenever you are ready, here's how to grow your construction business...

1. Join our Facebook Group which built completely for businesses within the construction industry. Real people, real support. - Now also available on LinkedIn.

2. Keep up to date with Construction Insider Providing you with industry insight, tips & tricks and much more to make sure you are ahead of your competitors!

3. When you are ready, Become a Saint Financial Group client, and we will provide you with the highest quality solutions to effectively scale your construction business. Book your meeting here!

What software expenses can I claim for R&D?

Written by the team at:

Saint Taxation

Got a question? Ask us here 😉
Construction Insider Logo

Grab Your FREE Copy Here!

The Saints Dashboard
Saint Accountancy
Advertise with us

How To Grow Your

🚧 Construction Businesses 🚧

Get Started With Saint

Construction Insider

Person With Significant Control Explained‍

What are Persons With Significant Control and What Do They Mean? This blogs shows what conditions need to be met for someone to be listed as a Person With Significant Control (Limited Companies) on Companies House

Next Article