Research and Development tax credits

R&D tax credits are a UK tax incentive scheme, designed to encourage companies to invest in R&D. This enables a vast range of companies to reduce their tax bill or claim tax credits against their R&D costs. These credits are aimed at companies that are actively involved in research and development. The definition includes the innovation, improvement or development of a process, product or service.

Large numbers of companies who are eligible to take advantage of the scheme, are missing out. This is because they are unaware they are able to claim, or they are daunted by the perceived complexity of the claim. Our specialist team of engineers, software programmers scientists and specialist tax accountants undertake all the forensic work, to identify and maximise any qualifying R&D expenditure. This includes staffing costs, material costs, software, and subcontracted works.

The information is summarised in a report, focusing on the technological and/or scientific issues as well as incorporating the financial costs, this is then submitted to HMRC. We produce the coherent audit trail needed to support any claims with HMRC, and deal directly with any subsequent enquiries.

We have achieved a 100% success rate with the claims we have submitted on behalf of our clients. We operate on a no-win no-fee basis, so checking with our team that you are eligible to make a claim involves no risks whatsoever. This is why our specialist performance based service is so valuable to our clients.

Who can claim?

If your company performs any activities that fall within the definition of research and development, you should be claiming the generous additional R&D tax relief that is available. The defining criteria is;

Seeking to achieve an advance in Science or technology

Subject to Scientific or technological uncertainty

Conducted in a systematic and thorough fashion

R&D covers all sectors of business but so many businesses do not think they are eligible, and are missing out. Innovative work and problem-solving are integral to many industries such as construction, software development, clean technology and manufacturing, and this opportunity is not just restricted to the obvious lab based medical, pharmaceutical or defence based industries as commonly thought.

What are the benefits?

There is a lot of terminology around R&D tax relief, but don’t be put off. The key point is that from 1 April 2015:

If you are an SME, for every 100,000 spent on R&D, you could receive a 230,000 deduction from your corporate taxable profits potentially triggering a cash refund of up to 26,000 or, if loss-making, gain a cash refund of up to 33,000.

If you are a large company, you could trigger a benefit of up to 110,000 in the accounts for every 1,000,000 spent in the company accounts under the R&D expenditure credit scheme.

These are valuable benefits – if you think you are not spending any money on R&D, think again. You may well be.

Many companies are missing out on the highly valuable tax relief opportunity. Why would any professional company not undertake a free of charge initial review of their right to make a claim? This is surely just good business practice.

Contact us today to book your initial review – 01323 365457

 

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