The HMRC’s R&D Tax Credit scheme is a many splendoured thing. By incentivising companies to undertake research and development to improve the products and services they supply, it paves the way for more and more companies to benefit, helping to generate a stronger UK economy.
The trick is not to put off dipping that first toe in the water. Which is where you come in.
It’s a common misconception that R&D Credits are just for companies that have developed groundbreaking new products. Not true! The fact is that any activity which a company carries out to improve an existing product, process or service makes it eligible for an R&D Tax Credit.
Take the successful claim made by mens’ hire business ACS Clothing Ltd, based in Glasgow. The claim was based on their investment in developing new computer software to improve product handling. The software helped accelerate the speed at which garments were brought in, cleaned and then re-distributed, providing a better service to their many clothing-retailer clients throughout the UK. But it didn’t end there…
The advances ACS Clothing made with one piece of processing software had a knock-on effect that stretched far beyond Glasgow, leading to efficiency improvements in the many UK-based clothing companies that they supply.
That’s typical of how the organic process we call progress works and demonstrates just how important a role small, efficient companies play in creating a stable economy. No wonder HMRC allows SMEs to claim Tax Credits at a better rate than larger companies.
Who is eligible?
The Government's R&D tax credits scheme isn't just for companies with R&D departments and men in white coats.
Indeed, you may be surprised to discover that any company that spends money trying to improve a product or service through a technological advance, using qualified staff and appropriate project controls, and where there's doubt about the project's success, is likely to be eligible.
Over 6,600 SMEs and 1,760 Large Companies are already claiming more than £980m each year in R&D tax relief from HMRC, but many more thousands aren't. Is your company one of them?
To find out more about R & D tax credits and how may be able to claim, please contact Auditel in Brooklands House, Marlborough Road for a no obligation discussion on 01903 680002.