R&D Tax Credits are the primary form of tax relief for promoting innovation in the UK. A cash benefit of up to 33.35% of qualifying R&D expenditure can be claimed that includes the costs of testing, experimentation, software / product development and process improvement.
What is the difference between R&D Tax Relief and R&D Tax Credits?
R&D Tax Relief is the name of the scheme that allows companies to claim an enhanced tax deduction for qualifying R&D expenditure. The enhanced amount can be surrendered for a cash credit (the R&D Tax Credit) if the company is loss-making, or used to offset tax due if a company is profitable.
Any company subject to UK corporation tax can potentially make an annual R&D claim to HMRC for qualifying activities.
Qualifying projects must be in a field of science or technology and can include new product or process development, or making an appreciable improvement to those that already exist. You do not need to be the first in the industry to achieve something, providing that the technology solution is not in the public domain, or obvious.
R&D Tax Credits are available for Small and Medium-sized Enterprises (SME) while the R&D Expenditure Credit gives an above-the-line benefit to Large companies.
The R&D Tax Relief scheme is administered by HMRC who have 5 Specialist Units that deal with all SME R&D claims. The inspectors at these units are usually very experienced and adept at investigating whether or not claims meet the requirements of the legislation. A claim can be made either by filling in the appropriate boxes as part of the Corporation Tax return (CT600), or alternatively, by filing an amendment to a return. We always advise the latter as it ensures that all the supporting documentation reaches the inspector at the same time as the claim, thus avoiding the possibility of an enquiry.
We help businesses of all sizes grow and improve their cash flow by assisting them in claiming R&D Tax Relief. Our rigorous and repeatable process is combined with high quality claim documentation to ensure companies claim the maximum allowable under the legislation and minimises the likelihood of HMRC enquiries. We have a 100% success rate across hundreds of claims, both in number and in quantum of those claims.
Our staff combine industry know-how and technology backgrounds with practical experience of compiling R&D claims since 2003 – longer than almost anyone else.
We have an unbeatable 100% success rate in both number of claims accepted by HMRC and the amount of those claims, and work entirely on a no-win no-fee basis meaning that you don’t pay a penny until you receive your benefit.