R&D in Construction

Key facts

Innovative building methods (modular construction, 3D printing, offsite manufacturing) can qualify when they involve technological uncertainty.
Structural engineering challenges — such as designing foundations for unusual ground conditions — frequently qualify.
Sustainability and energy efficiency projects involving new materials or systems with uncertain performance can qualify.
Subcontractor costs are a significant element in construction R&D claims (at 65% for unconnected parties).
Construction R&D is often project-specific — even routine contractors may have qualifying activities on unusual or complex projects.

R&D in the Construction Sector

The construction industry is one of the most under-claiming sectors for R&D tax credits. Many construction firms assume that R&D is only for laboratories and technology companies, when in reality, construction projects regularly involve genuine scientific and technological challenges.^[2]

R&D in construction typically arises on complex or unusual projects where standard methods are insufficient and the team must innovate to find solutions.

Areas That Commonly Qualify

Structural Engineering

Designing foundations for challenging ground conditions (contaminated land, high water tables, unstable soil) where standard solutions are inadequate
Creating long-span structures or unusual geometries where structural behaviour is uncertain
Developing temporary works for complex demolition or construction sequences
Engineering solutions for historic buildings where modern interventions must work with existing structures of uncertain condition

Building Methods & Processes

Modular and offsite construction where the assembly method, structural connections, or weather-tightness are uncertain
3D concrete printing or additive manufacturing in construction where material properties and structural performance are unproven
Novel formwork systems for complex concrete pours where the form design must handle unusual pressures or geometries
Developing construction sequences that have not been attempted before (e.g. building over live infrastructure)

Materials & Sustainability

Developing or testing low-carbon concrete mixes (geopolymer, GGBS, fly ash) with uncertain structural performance
Using novel insulation materials or building envelope systems to achieve energy targets beyond proven capability
Experimenting with cross-laminated timber (CLT) or other engineered timber in structural applications where behaviour is uncertain
Creating green roofs, living walls, or SUDS systems with uncertain long-term performance

Examples of Qualifying Construction R&D

Project	Uncertainty
Designing piled foundations through contaminated made-ground with variable bearing capacity	Standard pile designs insufficient; uncertain whether the proposed pile type and depth will achieve the required capacity in the variable ground
Developing a modular bathroom pod that meets fire, acoustic, and structural requirements while being 30% lighter than existing designs	Uncertain whether the proposed materials and construction method can simultaneously meet all regulatory requirements at the target weight
Achieving Passivhaus certification on a conversion of a Grade II listed building with single-skin masonry walls	Internal insulation strategies may cause moisture problems; uncertain whether the required airtightness and U-values can be achieved without damaging the historic fabric
Using a novel self-healing concrete mix on a marine structure exposed to saltwater and freeze-thaw cycles	Long-term durability and crack-healing performance of the mix in these specific conditions is unproven
Developing an automated bricklaying system for non-standard wall profiles with variable bond patterns	Existing robotic systems cannot handle the variation in brick sizes and bond patterns; vision system and path-planning algorithms must be developed

What Does Not Qualify

Standard construction: Building using established methods, standard designs, and proven materials
Routine design: Structural, mechanical, and electrical design using standard codes and known solutions
Project management: Planning, scheduling, and coordinating works
Regulatory compliance: Meeting building regulations using established techniques
Aesthetic design: Architectural design for appearance (though the structural or environmental engineering to achieve an unusual design may qualify)

Project-specific R&D: In construction, R&D often arises on individual projects rather than as a dedicated activity. A contractor may not have an “R&D department,” but specific projects may involve qualifying activities. Review your most challenging projects for potential R&D.

Typical Eligible Costs

Cost Category	Construction Examples
Staff costs	Structural engineers, design engineers, site managers (time on R&D), quantity surveyors (R&D costing)
Subcontractors	Specialist piling contractors, geotechnical consultants, testing laboratories, structural analysis firms
Consumable materials	Materials for trial pours, test panels, prototype components, ground investigation samples
Software	Specialist structural analysis (FEA), ground modelling, thermal modelling software
Utilities	Power for on-site testing rigs, laboratory equipment

Tip: Construction R&D claims often involve significant subcontractor costs. Keep clear records of which subcontracted work relates to resolving technological uncertainty versus routine construction activities.

Frequently Asked Questions

Can a standard construction company claim R&D?

Yes. You do not need to be a research organisation. If your construction projects involve resolving genuine scientific or technological uncertainty — for example, building on unstable ground, developing new structural solutions, or achieving energy performance targets beyond established methods — the work to resolve those uncertainties can qualify.

Does green building and sustainability work qualify?

It can. If you are developing or implementing sustainable building techniques where the performance is uncertain — such as novel insulation materials, low-carbon concrete mixes, or passive house designs in challenging conditions — the work to resolve that uncertainty qualifies. Simply complying with building regulations using established methods does not.

Can we claim for work done by subcontractors?

Yes. Under the merged RDEC, if your company commissions the R&D work and engages subcontractors to carry out part of it, you can include 65% of the cost of unconnected subcontractors in your claim. The subcontractor does not claim — the company directing the R&D does.

Does BIM (Building Information Modelling) qualify?

Using standard BIM software for design and coordination does not typically qualify. However, if you are developing novel BIM workflows, custom plug-ins, or using BIM to solve problems that go beyond the known capabilities of the software — such as real-time structural analysis integration — that work may qualify.

Sources

Guidelines on the meaning of research and development for tax purposes — GOV.UK / DSIT
Corporation Tax: Research and Development (R&D) relief — GOV.UK
CIRD81900 – R&D tax relief: conditions to be met — HMRC