Research and development (R&D) empowers farmers to improve crop yields, increase their profits, and provide higher-quality products – but such research can be expensive.
R&D tax credits provide a crucial lifeline for farmers and agricultural businesses looking to innovate in the sector without breaking the bank.
At randd, our R&D tax consultants have a proven track record of claiming back thousands of pounds for farming and agricultural clients, enabling them to offset research costs and invest in further growth and development.
How can farmers qualify for R&D tax credits?
There are three core eligibility criteria for R&D tax relief:
- An advance in science and/or technology must be sought in an overall field, not just for your business.
- There must be scientific or technological uncertainty.
- You must be able to explain the work you did to overcome the uncertainty.
Examples of qualifying R&D include:
- Developing new climate-resilient crop varieties.
- Improving machinery and harvesting processes to increase crop yields.
- Incorporating bespoke technological solutions to automate tasks.
- Conducting experimental trials to enhance the welfare of farm animals.
- Designing and testing new methods of pest control.
- Experimenting with new techniques to reduce energy consumption.
Remember that even unfinished or abandoned projects could be eligible for R&D tax relief.
randd’s R&D tax consultants can help you understand whether a project qualifies under the scheme.
What counts as qualifying expenditure for R&D tax relief?
HM Revenue & Customs (HMRC) lists the following as qualifying costs for R&D tax relief:
- Direct R&D staff costs (including salary, wages, NIC and pension funds)
- Externally provided R&D staff
- Subcontracted R&D
- Consumable items
- Software used directly in R&D activities
- Prototypes
- Collaborative work
R&D for accountants can be extremely challenging since most lack the time or specialist knowledge to navigate the complexities of the R&D tax relief scheme.
Our specialist R&D tax consultants will provide you with everything you need to maximise your client’s claim and ensure all qualifying expenditure is included.
How to help my farming and agriculture clients with R&D tax relief
R&D tax relief provides an excellent opportunity for farmers and agricultural businesses to access financial support for innovative projects.
Accountants looking to claim R&D tax relief for their farming and agricultural clients need to submit a detailed report outlining the R&D activities, the technological challenges encountered, and how the project aimed to address them.
While claiming R&D tax relief may seem complex, working with specialist R&D tax consultants can simplify the process and help you make sure that all eligible costs and activities are included.
At randd, we provide expert R&D help for accountants to put together a watertight claims process that will minimise the chances of HMRC enquiries.
