Enhanced R&D Intensive Support (ERIS): Who Qualifies and How Much Can You Claim?

Written by: Beth Anderson

Manager, Corporate Tax

Last reviewed: 13 November 2026

If your company is investing heavily in research and development but isn’t yet making a profit, you could be entitled to a higher level of R&D tax relief through Enhanced R&D Intensive Support (ERIS). 

Introduced from 1 April 2024, ERIS is aimed at loss-making SMEs that spend a significant proportion of their costs on R&D. For businesses that meet the criteria, it can provide a considerably higher benefit than the standard Merged R&D Scheme. 

ERIS at a Glance 

Key Takeaways 

• ERIS is a specialist R&D tax relief regime for loss-making SMEs. 

• Companies generally need qualifying R&D expenditure to represent at least 30% of total expenditure. 

• Support can be worth up to 26.97% of qualifying R&D costs. 

• A one-year grace period may help businesses retain eligibility if R&D spending temporarily falls below the threshold. 

• Good technical and financial records are essential to support a claim. 

What Is ERIS? 

ERIS stands for Enhanced R&D Intensive Support. 

When the UK’s R&D tax relief rules were reformed, many businesses moved into the new Merged R&D Scheme. The Government recognised that some loss-making SMEs carrying out substantial R&D would be worse off under the new rules, so ERIS was introduced to provide additional support for these businesses. 

The regime is particularly relevant to early-stage businesses that are investing heavily in developing products, technology or processes before generating significant profits. 

Who Can Claim ERIS? 

To qualify, a company must: 

• Meet the SME definition for R&D tax purposes 

• Be loss-making 

• Carry out qualifying R&D activities 

• Satisfy the R&D intensity requirement 

A Quick Eligibility Check 

Your business may qualify if you can answer “yes” to the following questions: 

• Are you an SME? 

• Did your company make a loss during the period? 

• Are you undertaking qualifying R&D projects? 

• Does qualifying R&D expenditure represent at least 30% of total expenditure? 

If the answer is yes to all four, ERIS may be available. A detailed review is still needed to confirm eligibility. 

Understanding the 30% R&D Intensity Test 

A key requirement of ERIS is the R&D intensity test. 

This measures qualifying R&D expenditure as a percentage of your company’s total expenditure. In most cases, qualifying R&D costs must represent at least 30% of total expenditure for the accounting period. 

Qualifying expenditure can include: 

• Staff costs directly involved in R&D 

• Employer NIC and pension contributions 

• Certain subcontractor costs 

• Externally provided workers 

• Software costs 

• Data licences 

• Cloud computing costs 

• Consumable items used in the R&D process 

Small changes in how expenditure is classified can affect whether a company passes the threshold, so the calculation should be reviewed carefully before a claim is submitted. 

How Much Is ERIS Worth? 

ERIS allows qualifying companies to surrender losses in exchange for a payable tax credit. 

The effective benefit can be worth up to 26.97% of qualifying R&D expenditure, although the actual amount will depend on your company’s circumstances and the level of surrenderable losses available. 

For many loss-making technology and engineering businesses, this can result in a larger cash repayment than would be available under the standard Merged R&D Scheme. 

What Is the ERIS Grace Period? 

R&D expenditure rarely follows a straight line. A business may spend heavily on development one year and less the next. 

To recognise this, ERIS includes a one-year grace period. A company that has previously qualified may be able to continue claiming ERIS for a further year even if it falls below the 30% threshold.  

The rules are detailed and should be reviewed on a case-by-case basis, particularly where expenditure levels fluctuate significantly between accounting periods. 

What Happens If Your Company Becomes Profitable? 

ERIS is specifically designed for loss-making businesses. 

If your company returns to profitability, it will generally claim under the Merged R&D Scheme rather than ERIS for that accounting period. As businesses grow, it is common to move between regimes over time. 

How HMRC Reviews ERIS Claims 

HMRC has increased its scrutiny of R&D tax relief claims in recent years. 

Companies should keep clear evidence showing: 

• The scientific or technological advance being sought 

• The uncertainties encountered 

• The work undertaken to resolve those uncertainties 

• The qualifying expenditure included in the claim 

• How the R&D intensity calculation has been prepared 

Strong documentation can help reduce the risk of delays, enquiries and challenges from HMRC.  

ERIS vs the Merged R&D Scheme 

For businesses that qualify, ERIS will often deliver a better result. The challenge is ensuring the eligibility requirements are met and properly evidenced. 

How Henderson Loggie Can Help 

Determining whether ERIS applies involves more than identifying qualifying R&D projects. 

You also need to consider: 

• SME status 

• The calculation of qualifying expenditure 

• The intensity threshold 

• Group company structures 

• Loss utilisation 

• Grace period eligibility 

Our R&D tax specialists work with businesses across technology, manufacturing, engineering, life sciences and other sectors to assess eligibility, prepare robust claims and support companies through HMRC enquiries where required.

Speak to Our R&D Tax Specialists 

If your business is investing heavily in research and development and is currently loss-making, ERIS could provide valuable funding to support future growth. 

Get in touch with our R&D tax team to discuss whether your company qualifies and how much relief may be available.

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