R&D Tax Credits and Tax ReliefRead more about R&D tax reliefs & credits and how Luvo Financial can help you secure this valuable tax relief.
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!
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. The R&D tax relief specialists at Luvo Financial can help to assess your eligibility for an R&D claim and guide you towards securing this valuable relief.
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”. However, 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.
Over the years, Luvo Financial has developed and maintained 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 Luvo has maintained a 100% success record in our time of providing support in making R&D tax relief claims. Read our R&D success stories here.
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. When you work with Luvo Financial, there is nothing to pay until an engagement has been formally agreed and our fees are success based – ‘no-win-no-fee’!
Identify qualifying expenditure
After initially confirming eligibility, we identify qualifying R&D expenditure, according to HMRC rules. As R&D specialists, Luvo 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 our detailed knowledge of what does and does not qualify for R&D tax relief, Luvo Financial can save you time and ensure the correct costs are being claimed, and maximised.
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, the R&D specialists at Luvo Financial will ensure this is written and delivered in the way HMRC requires.