THE FREQUENTLY ASKED QUESTIONS
DO I QUALIFY? WHAT COULD A SUCCESSFUL CLAIM BE WORTH?
If you can’t find the answer here, please get in touch and one of our expert advisors will be happy to discuss our procedures with you.
Do I qualify?
If you can answer yes to one or more of these questions then it’s very likely that you do:
- Have you developed or invested in any bespoke products, materials, devices, processes and/or services?
- Has your company made improvements to your products, materials, devices, services and internal processes?
- Has any of your development work involved technological or scientific difficulty in terms of how to achieve your aims or required you to have to trial and test a possible solution with no guarantee of success?
- Have you been involved in a project where the industry standard solution did not meet your requirements and you had to think outside the box to solve the problem?
- Have you had to resolve technical problems with any of your products?
- Have you experimented with any new equipment or production techniques?
- Do you have clients who come to you for your expertise and specialist abilities?
- Are you regularly problem solving for your customer needs?
- Have you developed, introduced or improved any software for your business?
In addition, if you recognised that a new approach was needed to fix an existing problem but at the outset weren’t sure if there was an achievable solution, or if R&D innovations were employed in an attempt to brainstorm the problem and create the solution, this also qualifies.
What can I claim for?
Qualifying R&D expenditure includes staff costs, externally provided workers, consumables, utilities, travel costs and sub-contractor costs.
If eligible, you can typically claim R&D tax relief for qualifying expenditure incurred during the two previous accounting periods. In other words, while in your 2018 accounting period, we can consider a claim for the financial years ending 2016 and 2017.
What could a successful claim be worth?
According to recent statistics provided by HMRC the average claim made by small and medium sized companies in the UK in 2017/18 was £61,314, but for many companies it can be much more.
R&D tax credits are available to small and medium-sized companies (SME’s) and also to large companies.
An SME is a company which has fewer than 500 employees and either a turnover of less than €100m or a balance sheet of less than €86m.
The R&D SME regime allows a company to deduct an extra 130% of their qualifying expenditure from their yearly profit, as well as the normal 100% deduction, to make a total 230% deduction or claim a tax credit if the company is loss making, worth up to 14.5% of the surrenderable loss.
R&D SME tax relief is worth 33p for every £1 spent on qualifying R&D expenditure.
Large companies (or SMEs who can`t claim through the SME regime) can claim R&D tax relief through a regime called RDEC (Research and Development Expenditure Credit). Companies claiming through RDEC can claim a tax credit of 12% of the cost of qualifying R&D expenditure incurred.
RDEC is worth up to 9.72% of qualifying R&D expenditure (8.91% prior to 1 January 2018) to a large company subject to the 19% corporation tax rate and applying the 12% relevant percentage from 1 January 2018.
Are there any upfront costs?
No, and we will only charge for a successful submission. Should we fail to identify a claim then we will cover the cost of our time spent with you. A typical R&D tax relief claim takes between four and six weeks for HMRC to consider and process. In the unlikely event that HMRC has questions concerning the claim, we will resolve these at no extra cost to you.
TAX RELIEF FOR INNOVATIONS
Over £3 Billion of tax relief support given to UK Companies since 2000
Talk to R and D Reclaims today to find out how we can help you reclaim what is legally yours.