Research and Development tax credits, commonly referred to as simply ‘R&D’ is a government incentive designed to drive forward innovation across multiple industries.
This is an opportunity for you to reduce your corporation tax bill or receive a refund from HMRC based on the working hours your business dedicates to R&D.
We often find that R&D is under-claimed, meaning vast numbers of businesses are missing out on some significant tax relief.
So, which business activities qualify as research and development?
To list every project that could qualify for R&D would make this blog very long indeed. According to gov.uk, to claim R&D relief you need to be able to explain how your project meets the following criteria:
- The project looked for an advance in science and technology
- The project had to overcome an uncertainty
- The project tried to overcome an uncertainty
- The problem couldn’t be easily worked out by a professional in the field
The scope for R&D is very broad, eligible projects aren’t always what you’d expect. In other words, you don’t always have to be a mad scientist in a lab coat to qualify for R&D tax relief.
For example, one of our clients, a large insurance provider, grew tired of using off-the-shelf Customer Relationship Management (CRM) systems that weren’t quite right for their business.
So, they decided to design their own piece of software from scratch. Upon learning about this, we informed the client that such an activity was likely to qualify them for R&D. The result we ultimately achieved for them meant that instead of the client paying HMRC £15,000, HMRC paid them £25,000.
If you’ve read this far and think you may be eligible, then simply get in touch. Our process starts with learning about your business and the nature of the projects it is involved in. Once we’ve established a thorough understanding of your business and its activities, we can review and identify areas that qualify you for R&D tax credits.
You really could be missing out on thousands of pounds of tax savings, or even a cash refund! To take the first step, contact us today.