R&D Tax Credits

DURING THE LATE 1970s and early 1980s, Bill Werbeniuk was one of professional snooker’s most renowned figures. Nicknamed ‘Big Bill’ – he was the first man to split his trousers during a televised match – and consuming between 40 to 50 pints a day, he was prominent character of the game.

Suffering from a hereditary nervous disease, Bill’s habit of ‘downing at least six pints before a match and then one pint for each frame’ was medically certified; in turn, the envy of every armchair viewer when it was explained that he could offset the cost of beer against his income tax.

The qualification for tax relief is rarely so colourful as Bill’s tale. However the potential opportunity missed within UK construction sector is a far more important story.

A key aim of the Construction Sector Deal was to increase spending on Research and Development (R&D) in the sector to stimulate innovation. The House of Lords Select Committee review into offsite construction advocated that:

HMRC should work with the [offsite] sector to foster greater understanding of how R&D tax credits work, what the benefits are and how to meet the criteria to receive them.

The same review identified that wider use of R&D tax credits could help increase spending on R&D. Government statistics show that the construction industry has been slow to recognise its participation in conducting R&D.  With perception of R&D often governed by stereotypes, construction firms can be blind to how development of bespoke solutions, realising technological advances and resolving uncertainty could constitute qualifying expenditure. It is all too easy to be blind to the accomplishments of our industry and how the  professionals within it address complex challenges that demand innovative and unique solutions.

However this position has begun to shift:-

Figure 1: 5-year period increase in claims

Since 2013/14 claims have increased by 750%. Prior data suggested that only 3% of SMEs and large organisations had put forward claims in the year 13/14; the latest statistics show that this is now up to 30%*.

With an industry gravitating towards the adoption of Modern Methods of Construction (MMC), this trend is expected to continue. In lobbying for fiscal incentives, some have proposed that:

R&D should be recognised as an inherent and critical part of offsite to maximise the potential of the sector and its positive impact on the wider construction industry.

Whilst this inherent position is not recognised under HMRC’s definitions, it is not to say the potential for qualifying expenditure does not exist. For SMEs this can be as significant as 25p/£1, with qualifying expenditure including staff and external work costs, software licenses, certain consumables, and subcontracted R&D.

 As experts in MMC, Akerlof supports its clients by providing clarity, intelligence, and insight into how businesses can apply modern methods to realise their business objectives. Identifying the potential qualifying expenditure and supplying you with experts that can support your claim, is a service we provide FREE.

 We want to support those invested to deliver better outcomes. Credit for innovation, not just beer money for Bill.

*Data pool excluding micro SMEs and individual contractors.

Jamie Hillier


With a penchant for tweed and jackets with leather arm patches, Jamie began his career as a quantity surveyor, before climbing the ladder to lead major projects for a Tier 1 contractor.

Eventually expanding his book collection beyond copies of SMM7, Jamie has interest in a broad range of subjects linked to delivering better outcomes for society and the environment.

His strategic insights on MMC and behavioural science have made their way into numerous government, industry and academic publications, including the Construction Playbook, Transforming Infrastructure Performance Roadmap to 2030, the Platform Rulebook and the RIBA DfMA Overlay.

John Handscomb


Construction is in John’s blood. Learning from his father who was a planner and project manager, John began his career by working on some iconic projects in both the public and private sector.

As a procurement expert and integrator of new ways of working, John has pioneered the integration of platform principles, DfMA processes and supply chain within over £5bn projects in the last 15 years, for some of the largest building programmes in the UK. Despite his considerable expertise, John keeps it simple, communicating complicated ideas with ease and helping to equip the industry with new knowledge and skills.

Outside of Akerlof, John enjoys his executive role with technology start-up ScanTech Digital, spending time with his family, taking trips down the football, playing a bit of golf with friends and the odd pint. 

Our name is shared with George Akerlof, a Nobel Prize-winning economist.

His seminal paper, Market for Lemons, demonstrated the devastating consequences of making decisions under the conditions of quality uncertainty and unequal information between buyers and sellers, increasing the chance of buyers ending up with a ‘lemon’.

This 50-year-old concept continues to retain parallels within the construction industry.

Through our insight and experience, we can rebalance this information asymmetry on behalf of our clients, levelling the playing field to deliver better outcomes.