Most businesses have been negatively impacted by COVID. Cashflow is, understandably, a key concern for the majority of companies with insufficient working capital and external/internal funding critical to ensure business continuity.
R&D Tax Incentives
An established way of generating extra cash can be via the Research & Development (‘R&D’) Tax Relief incentive operated by HM Revenue & Customs (‘HMRC’) which can result in direct cash payments of up to 33% of every £ spent on qualifying projects (e.g. salary costs, consumable costs, contractors’ costs). Many businesses may have not taken advantage of this – either because they thought they did not apply to them, or because it is too complex and the benefit is perceived as being small compared to the time and effort required.
Let’s dispel some myths…
“We don’t do R&D” - Are you sure? The criteria for eligibility are very broad. ‘Qualifying activity’ is not limited to the obvious example of development of new products. It can just as easily apply to activity such as:
- overcoming technical problems
- making improvements to existing processes
- changing products or processes to be more efficient or more environmentally friendly
- changing products or processes to meet new regulatory requirements
- building and integrating new IT systems
“It will take too much of our time” - Quest Tax Services have established processes which keep to a minimum the time you spend providing information.
Our process typically takes less than 4 hours of your time and significant experience within our team of working in both industry and accountancy, we know the pragmatic solutions that HMRC will accept – and we know how to be concise and clear while not asking for more from you than we need.
What can you do now?
R&D claims can still be made within two years of the end of an accounting period. For example, a company with an October period end can still make claims for the period ended 31 October 2018 as at the date of writing, with claims typically paid within 4 to 6 weeks.
There has never been a better time to reassess your eligibility for R&D tax relief. Quest Tax Services are offering a confidential, no obligation consultation. For more information on R&D tax relief incentives please contact us to find out more.