Cost	SME Scheme	RDEC	Notes
Staff Costs			Cost of employing staff (gross salary, overtime, bonuses, employers’ national insurance and employees’ pension contributions)
Consumables			Materials consumed within the R&D (can include prototype costs, light, heat and water)
Subcontractors			See below
Software			Software costs (those incurred either directly in the R&D process such as CAD software or other equivalent or costs incurred in indirectly supporting the process, such as Microsoft packages or accounting software)
Externally provided workers			Externally provided workers (this can include staff employed through an agency or a director or member of staff employed by another company within a group of companies)
Clinical volunteers
Contributions to universities

Subcontractors

A subcontractor relationship exists where all or part of a project is subcontracted. It does not apply where individuals supply labour to work on an R&D project.

Under the RDEC the costs of a subcontractor can only be claimed where the subcontractor cannot claim, for example if the subcontractor is an individual or a university. If the subcontractor is an SME, the subcontractor would claim under the RDEC.