Short answer
Lenders typically advance 50–80% of the expected R&D tax credit, and are repaid when HMRC pays. The exact amount depends on the size and quality of the claim, who prepared it, your history of claims and whether HMRC is likely to deduct tax you owe. Lenders don't advance 100%, so that small changes to the claim don't leave the loan uncovered.
Key facts
- Typical advance: 50–80% of the expected credit
- Based on the credit, not total R&D spend
- Lower for first-time claims, claims well above prior years, or tax arrears
- Many lenders have a minimum facility size
Why lenders don't advance 100%
The credit isn't certain until HMRC pays. The buffer covers small reductions, interest and fees. If HMRC cuts the claim further, the borrower must make up the difference. See what happens if HMRC reduces your claim.
Claim value vs maximum advance (at 80%)
| Expected R&D tax credit | Advance at 80% |
|---|---|
| £62,500 | £50,000 |
| £100,000 | £80,000 |
| £250,000 | £200,000 |
| £500,000 | £400,000 |
What reduces the amount?
- Tax arrears. HMRC can set the credit against PAYE, VAT or Corporation Tax you owe.
- First-time claims. No track record with HMRC.
- Big jumps. A claim much larger than previous years.
- Overseas costs. Costs that may not qualify under the current rules.
- Adviser quality. Some lenders only accept claims from advisers they know.
Can I borrow before I file?
Some lenders will advance against a claim not yet filed, using a letter from your accountant or R&D adviser confirming the expected claim size and filing date. This can bring funding forward by several months.
How Nighthawk does it
R&D Advance lends up to 80% of your eligible R&D tax credit, with a minimum facility of £50,000 (claims of about £62,500 and above). You can apply before your CT600 is filed, with a comfort letter from your accountant or R&D adviser.
Related questions
Is the advance based on my R&D spend or my credit?
On the credit HMRC is expected to pay, not total spend.
Can first-time claimants borrow?
Often yes, if a reputable adviser prepares the claim, though the advance may be lower.