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NAA knowledge intensive company (KIC) is a type of UK business that focuses heavily on innovation, research, or the development of intellectual property. HMRC uses this classification when assessing certain tax reliefs and investment schemes, particularly under the Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS).
What makes a company knowledge intensive?
To be recognised as a KIC, a business must meet specific criteria relating to its activities and spending. These typically include:
- A significant portion of operating costs is allocated to research and development (R&D).
- The creation of intellectual property is a core part of its business model.
- Employing skilled staff engaged in technical, scientific, or innovative work.
- Operating in sectors such as technology, life sciences, engineering, digital, or advanced manufacturing.
Why it matters
KIC status allows a company to access enhanced investment incentives. For example, investors in KICs can benefit from higher investment limits under EIS and SEIS, making it easier for these businesses to raise early-stage funding.
Where it’s used
KIC classification is mainly used in the context of equity investment and tax reliefs. Companies seeking to attract investors through EIS or SEIS may apply to HMRC for advance assurance and demonstrate that they meet the knowledge-intensive conditions.
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