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Funding digital innovation through the tax system — e-commerce

This is an overview of how different areas of the digital economy take up funding for innovation through the tax system. Other sectors are covered in separate posts.
The e-commerce market has grown quickly over the last 10 years with different trends emerging and receding along the way. With such an established area of digital business it can often be the case that companies are simply catching up with the rest of the market and as such might not get over the obviousness hurdle when looking at whether or not funding support can be claimed through the innovation tax break.

Applying existing standards to a different sector can be a qualifying activity (in some cases) but applying existing standards to one particular business when others in its sector are already there is unlikely to qualify.

That said, there are strong areas of R&D in e-commerce which do qualify for tax relief. Payment infrastructure, cyber security and data science are all areas in which we have seen claims, the key technical challenge being how to handle a greater volume of transactions in a faster and more robust way.

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