How to get research grants and R&D funding for your business

UK businesses can get research and development (R&D) funding from three main sources: competitive grants and contracts, mainly through Innovate UK; partnerships with universities, such as Knowledge Transfer Partnerships; and R&D tax relief, which reduces your tax bill based on what you spend on qualifying R&D. Grants are competitive and usually cover only part of your project costs, so most businesses also need their own cash or finance to fund the rest.

This guide explains the main types of research funding available, how to find and apply for them, and how to fund the costs that grants and tax relief don't cover.

What are research grants for businesses?

Research grants fund specific projects that develop new or improved products, processes or services. Unlike a loan, a grant doesn't usually need to be repaid, as long as you use it for the agreed project and meet the grant's conditions.

Most research grants for businesses:

• are awarded through competitions, with set themes, deadlines and eligibility rules

• cover a percentage of eligible project costs, with your business funding the rest

• are paid in stages, often after you've spent the money and reported on progress

• come with reporting requirements and conditions on how the money is used

R&D tax relief is different. It isn't a grant, and you don't apply for it in advance. Instead, you claim it through your company tax return after you've carried out qualifying R&D. For more information on this, please consult a qualified accountant. This is not designed to be tax advice.

For a wider look at grants beyond research and innovation, see our guide to government business grants. 

Innovate UK funding

Innovate UK, part of UK Research and Innovation (UKRI), is the main source of government research and innovation funding for UK businesses.

Innovate UK competitions

Innovate UK funds projects through competitions, each with its own theme, budget, eligibility rules and deadline. Some focus on specific sectors or technologies, while others are open to a wide range of ideas. You can find open and upcoming competitions on the Innovation Funding Service, and all applications must be submitted through it.

Many competitions are open to businesses of any size, either on their own or working with partners. In collaborative projects, the lead applicant and at least one other partner must request funding, and no single organisation can claim more than 70% of the total project costs, according to Innovate UK's application guidance. The share of your costs a grant will cover depends on the competition, the type of research and the size of your business.

Innovation loans

For later-stage R&D projects with a clear route to market, Innovate UK has offered innovation loans to micro, small and medium-sized businesses, with patient repayment terms. These are loans, not grants, so they need to be repaid. These loans are subject to interest on the principal amount.  

Knowledge Transfer Partnerships

A Knowledge Transfer Partnership (KTP) connects your business with a UK university or research organisation and a recent graduate, known as an associate, to work on a specific innovation project. The associate works in your business, supported by academic experts.

KTPs are part-funded by Innovate UK. Your business contributes to the project costs, typically 67% for small and medium-sized businesses and 50% for larger businesses. The funding covers the academic team, the associate's salary, project consumables, training and travel.

KTPs open for applications in rounds throughout the year, listed on the Innovation Funding Service. The usual first step is to speak to a university's KTP office about your idea.

The Small Business Research Initiative (SBRI)

The Small Business Research Initiative helps public sector bodies find innovative solutions to specific challenges, in areas such as health, defence, transport and the environment. Instead of offering grants, SBRI competitions usually award development contracts, often in stages, starting with a feasibility phase.

Despite the name, SBRI competitions are usually open to organisations of any size. Competitions are listed on the Innovation Funding Service and on UKRI's funding finder.

Regional and devolved research funding

Some research and innovation support is run regionally. Depending on where your business is based, you may be able to find funding through:

• Scotland:Find Business Support, which includes innovation funding from Scottish Enterprise and others

• Wales:Business Wales, which signposts to innovation support

• Northern Ireland:Invest Northern Ireland, which offers R&D support for businesses

• England: local councils, combined authorities and universities, which sometimes run innovation programmes for businesses in their area

Gov.uk's finance and support for your business tool lets you search government-backed schemes, including grants, by region, sector and business size.

How to apply for a research grant

Every competition has its own process, but most applications follow these steps.

1. Find the right opportunity

Search the Innovation Funding Service, UKRI's funding finder and regional support services for competitions that match your project. Read the scope carefully. A strong project that doesn't fit the competition's aims is unlikely to succeed.

2. Check you're eligible

Look at business size, location, project type, collaboration requirements and which costs are eligible. Some competitions require you to work with a partner, such as a university or another business.

3. Plan your project

Set out what you'll do, the technical challenge you're solving, who's involved, the timeline, the costs and the commercial opportunity. Assessors want to see both innovation and a credible route to market.

4. Work out your share of the costs

Most grants cover only part of your project costs. Work out how much your business will need to fund itself, and how you'll cover costs before grant payments arrive.

5. Write and submit your application

Answer each question clearly and directly, with evidence where you can. Leave time to review, and submit before the deadline. Late applications aren't usually accepted.

6. Wait for assessment

Applications are typically scored by independent assessors. It can take several weeks or months to hear whether you've been successful, and longer before the project starts.

Tips to strengthen your application

• Show the innovation clearly. Explain what's new, why it's difficult and how it goes beyond what's already available.

• Prove there's a market. Show who will buy your product or service, how big the opportunity is and how you'll reach customers.

• Demonstrate your team's ability. Highlight the skills and experience needed to deliver the project.

• Be realistic about costs and timelines. Assessors look for projects that are well planned and good value.

• Get feedback. If you're unsuccessful, use any assessor feedback to strengthen your next application.

How to fund the costs grants don't cover

Research grants and tax relief rarely cover everything. You may need funding for:

• Your share of project costs, if the grant only covers part

• Costs you pay before grant payments arrive, since many grants pay in arrears

• Commercialisation, such as marketing, hiring, stock or equipment to bring your innovation to market

• Projects that don't fit a grant, or when no suitable competition is open

Funding Circle's range can help you fund these costs. Before using finance alongside a grant, check the grant's terms for any rules on other funding.

Business loans

A Funding Circle business loan gives you a lump sum you can use for almost any business purpose, including research, development and bringing a product to market. You can borrow up to £750,000 and repay in fixed monthly instalments, with decisions in as little as 5 minutes. We also offer government-backed loans under the Growth Guarantee Scheme from £25,001 to £250,000.

FlexiPay

FlexiPay gives you upfront finance when you need it, working as a simple credit line that works around you. Use it to pay for project costs upfront, such as materials, equipment, software or a supplier invoice, then choose to repay over 1, 3, 6, 9 or 12 months for a flat fee from 1.99% per transaction. It can help smooth cash flow while you wait for grant payments.

Cashback business credit card

For regular spending, such as software subscriptions and lab or workshop supplies, the Funding Circle Cashback business credit card turns spend into savings. You earn 2% cashback for the first 6 months or up to £2,000, whichever comes first, then 1% uncapped, and get up to 42 days interest-free as a grace period when you clear your balance in full each month.

Asset finance

If your project needs equipment or machinery, asset finance spreads the cost with fixed repayments. Our marketplace works with a panel of specialist lenders to find deals that suit your business.

Eligibility and important information

To apply, your business needs to be a UK limited company or LLP. You'll need at least 1 year of trading history for business loans, FlexiPay and the Cashback business credit card. If you're a limited company or LLP, you can check your eligibility without affecting your credit score.

Research grant FAQs

How do I get a research grant for my business?

Search the Innovation Funding Service and UKRI's funding finder for competitions that fit your project, check you're eligible, then submit a detailed application before the deadline. Applications are assessed competitively, so a clear project plan with a strong commercial case matters.

What is the difference between an R&D grant and R&D tax relief?

An R&D grant is funding you apply for in advance through a competition, for a specific project. R&D tax relief is claimed through your company tax return after you've carried out qualifying R&D, and reduces your tax bill or gives you a payable credit.

Can small businesses get Innovate UK funding?

Yes. Many Innovate UK competitions are open to businesses of any size, including small businesses working alone or with partners. Each competition sets its own eligibility rules, so check the details before applying.

How much of my project will a research grant cover?

It depends on the competition, the type of research and the size of your business. Most grants cover only part of the eligible costs, so you'll usually need to fund the rest yourself.

How long does it take to get a research grant?

Competitions typically take several weeks or months from the deadline to a funding decision, and projects may not start until after that. Some grants pay in arrears, so you may need to cover costs before the money arrives.

Can I use a business loan alongside a research grant?

Many businesses use their own funds or finance to cover their share of project costs or bridge the gap before grant payments arrive. Check your grant's terms first, as some schemes have rules about other funding.

Disclaimer

24/10/26 While we want to help as much as we can, the information found here is provided solely for informational purposes and should not be considered financial, tax or legal advice. Readers should seek independent tax advice from a qualified professional. To the extent permitted by law, Funding Circle does not accept any liability for any loss or damage which may arise directly or indirectly from the use of, or reliance on, the information contained here. If you have any questions, please speak to your professional adviser or seek independent legal advice.