R&D Tax Credits

R&D Tax Credits
Introduced in April 2000, Research and Development tax credits are a valuable government tax incentive for limited companies who invest time and money into developing new products, processes and services, or enhancing existing ones.

There are two schemes available to claim the relief;  SME (Small-Medium Enterprise) scheme, and the Large Company (Research and Development Enhanced Credit, RDEC). Companies who invest in R&D activity, are eligible for a cash payment, a reduction in corporation tax, or increased losses.

If you’re wondering whether an application is worthwhile, in April 2015, the government increased the incentive for SME’s, to 230% of qualifying expenditure, up from the previous 225%. In October 2016, further support was pledged by the Government to CBI, of £2bn of funding to be invested in R&D by 2020.

The average R&D Tax Credits claim for an SME in the UK is £60k!

Eligibility

Many businesses don’t realise they are eligible for R&D Tax Credits, due to common misconceptions and a general lack of awareness of the relief. This results in many companies who are eligible to claim, missing out on the huge financial benefits available to them.

There are some rules in place regarding what makes a company eligible to claim, namely; the company must be using “science and or technology” in the R&D work, they are “seeking to advance or improve a product, process, service or system”, they “stand the full commercial and financial risk” (of the R&D work), and they are “seeking to overcome technological uncertainty”. In saying this, even if your project was unsuccessful, the uncertainties weren’t overcome and the advance was not achieved, you can still claim for the time and money invested in working to overcome those uncertainties.

Our role

Over the years, we have developed and mantained a client-focused approach to claiming R&D Tax Credits. We prioritise flexibility and good time-management. We aim to take minimal time from the client, and essentially, do the hard work for them. Our process works, and is, in part, why we have maintained a 100% success record in our time of providing support in making these claims. 

Our contingent fees are one of the most competitive in the sector, and are reimbursed in the unlikely event that the claim is denied by HMRC. There is nothing to pay until an engagement has been formally agreed and it’s success based – ‘no-win-no-fee’! 

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Identify qualifying expenditure

After initially confirming eligibility, we identify qualifying R&D expenditure, according to HMRC rules. As specialists, we eliminate the chances of error i.e. including incorrect expenditure which fails to qualify as R&D – something that can raise an enquiry with HMRC if not done correctly.

Calculate qualifying costs

We calculate and maximise qualifying costs against which you can claim. Without specialist advice, there may be a tendency to over or underestimate qualifying costs. With detailed knowledge of what does and does not qualify, we can save you time and ensure that the correct costs are being claimed, and maximised.

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Prepare a Technical Justification Report

We prepare the required Technical Justification Report, that must accompany the R&D claim (amongst other documents). With our extensive knowledge and experience, we ensure that this is written and delivered in the way HMRC requires.

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