Research and Development (R&D) Tax Relief: Enhanced R&D intensive support for loss-making SMEs based in Northern Ireland
Source: gov.uk (2025-09-26)

Find out if you can claim Enhanced R&D intensive support (NI ERIS) as a loss-making, small and medium enterprise (SME) based in Northern Ireland.

Finance Act 2025 makes provision for loss-making, R&D intensive, SMEs that have a registered office in Northern Ireland. These provisions take effect for claims made on or after 30 October 2024.

You can choose to opt out of these provisions if you’re a SME with a registered office in Northern Ireland and your business activities involve no trade in goods, and no relevant activities in relation to the electricity. You can tell HMRC you want to opt out when you provide additional information to support your R&D claim (https://www.gov.uk/guidance/submit-detailed-information-before-you-claim-research-and-development-rd-tax-relief).

If your company is affected by the provisions, you are not subject to the restrictions on relief for payments to overseas contractors or to providers of externally provided workers. You will be able to claim ERIS, subject to a 3-year limit. Above this limit, R&D Expenditure Credit (RDEC) relief is available (to companies that meet the eligibility conditions) under the new merged scheme.

You should read this guidance if:
- you are a SME claiming ERIS
- your registered office is in Northern Ireland
- a trade in goods, or a trade which involves relevant activities in relation to the electricity
- no trade in goods, and your trade does not involve relevant activities in relation to the electricity, but you have not decided to opt out by notifying HMRC
Relevant activities are the generation, transmission, distribution, supply, wholesale trade and cross-border exchange of electricity.

Who can opt out

You can opt out of the Northern Ireland ERIS provisions if your business activities involve:
- no element of trade in goods
- no relevant activities in relation to the electricity market
You’ll need to tell us when you provide additional information to support your R&D claim (https://www.gov.uk/guidance/submit-detailed-information-before-you-claim-research-and-development-rd-tax-relief).

If you do this, the overseas restrictions will apply, but the limit on the amount of relief you can get in a 3-year period will not apply.

Overseas restrictions

For affected companies, if you’re claiming under ERIS, the restrictions on relief for overseas spend on contracted out R&D and externally provided workers (included at s1138A Corporation Tax Act (CTA) 2009) do not apply.

The restrictions, which limit claims for this expenditure, with some exceptions, will apply for any residual amounts for which RDEC is claimed under the merged scheme.

What a trade in goods is

You have a trade in goods if any of your business activities involves any element of trading in goods.

If you are not sure, you should proceed on the basis that you are trading in goods.

Relevant activities in relation to the electricity market

Relevant activities are the production, transmission, distribution, supply, wholesale trading and cross-border exchange of electricity.

How much you can claim under ERIS

ERIS relief is de minimis State aid. There is a limit to the amount of de minimis State aid that a business can receive within a given period. The 3-year limit applies to the total additional relief received by the company under the ERIS scheme, plus any other de minimis aid received by companies in the group.

This amount must not exceed €300,000 (for most businesses).

There are lower limits for certain businesses, for example those whose main activity is in the agriculture or fisheries sectors. You can contact HMRC for advice, email xxx@xxx.xx (mailto:xxx@xxx.xx).

You can find out more about enhanced R&D intensive support in CIRD125000 — R&D Tax Reliefs: reformed reliefs: ERIS: companies registered in Northern Ireland (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird125000).

De minimis State aid means support provided under any of a number of EU regulations. The regulations are amended or replaced from time to time. At the time of publication of this guidance (26 September 2025), the following EU regulations are applicable:

Commission Regulation (EU) No 2023/2831 (on the European Union website) (https://eur-lex.europa.eu/eli/reg/2023/2831) (de minimis aid)

Commission Regulation (EU) No 1408/2013 (https://www.legislation.gov.uk/eur/2013/1408/contents) (de minimis aid in the agriculture sector)

Commission Regulation (EU) No 717/2014 (on the European Union website) (https://eur-lex.europa.eu/eli/reg/2014/717/oj) (de minimis aid in the fishery and aquaculture sector)

Commission Regulation (EU) No 2023/2832 (on the European Union website) (https://eur-lex.europa.eu/eli/reg/2023/2832/oj) (de minimis aid granted to undertakings providing services of general economic interest)

The additional benefit amount for an ERIS claim is the amount that the benefit of the claim under ERIS exceeds the benefit of an equivalent claim for R&D expenditure credit (RDEC) under the merged scheme.

Calculation to work out the additional benefit

Follow these steps to calculate the additional benefit.

Add up all the benefit amounts from the claim.

Subtract the net value of the RDEC that the company would have qualified for if the expenses had instead been claimed under Chapter 1A of Part 13 of the Corporation Tax Act (2009). This is the third amount covered in section 1042K of the Corporation Tax Act (2009), the initial amount of expenditure credit, minus the notional tax deduction.

You should include the following benefit amounts in the calculation:
- the amount of R&D tax credit to which the company is entitled, and which it claims, for the period
- arises as a result of the Chapter 2 relief obtained by the company for the period
- is surrendered by the company to the other company under Part 5 or 5A of the Corporation Tax Act 2010 (surrender of relief between members of groups and consortia)
- the amount by which the liability of the company to pay corporation tax in any future accounting period is reduced by any losses carried forward from the current period which arose from the ERIS claim
To work out the 3-year limit

You should use the calculation show in the section, ‘calculation to work out the additional benefit’ for ERIS claims made in any previous accounting period of the company that began on or after 1 April 2024, and ended within the period of 3 years ending with the day on which the claim is made.

To this amount, you should then add the value of all other de minimis aid received in the same accounting periods by any company in the group. For example, the amount of any grant which counts as de minimis aid. You should then do this for all the amounts received in the 3 years ending with the day on which the claim is made.

If you are unsure whether or not an amount received is de minimis aid, you should ask the person or authority which provided the amount.

This should include any ERIS benefits received by any other group company, for example if another company also claims ERIS itself.

The resulting figure (all benefits, less RDEC) should not exceed the limit for the company (read the section ‘How much you can claim under ERIS’).

Claims for ERIS that go over this limit are not allowed. HMRC has the power to address inaccuracies in tax returns. If you submit an inaccurate claim, you may become liable for tax-geared penalties. If the limit for State aid is exceeded, the full amount that falls under the de minimis State aid will be withdrawn.

Relief you can get for expenditure that you cannot claim for under ERIS

If there is any expenditure you cannot claim ERIS for, because it would take you over the limit, you may be able to claim RDEC for that expenditure under the merged scheme, provided you meet the rules.

You can find out more about enhanced R&D intensive support:
- in CIRD125000 — R&D Tax Reliefs: reformed reliefs: ERIS: companies registered in Northern Ireland (https://www.gov.uk/hmrc-internal-manuals/corporate-intangibles-research-and-development-manual/cird125000)
- in Research and Development (R&D) tax relief: the merged scheme and enhanced R&D intensive support (https://www.gov.uk/guidance/research-and-development-rd-tax-relief-the-merged-scheme-and-enhanced-rd-intensive-support)