Location, location, location – Are accountants in tune with the local R&D scene?

Accountants often look for the best ways to help clients with R&D, but may struggle to understand the factors that affect the value of R&D.

As R&D tax consultants, we know that there is more to innovation than the work of a single business.

Knowing how the actions of one innovative business can affect the local area and how this in turn affects R&D funding could be valuable if accountants want to provide ongoing R&D assistance.

How important is location to R&D?

It might seem like it makes little difference where an innovative client is based, particularly as the world is more connected than ever.

However, new research has revealed the symbiotic relationship between R&D and the local area.

It was discovered that “a £5 million grant distributed over three years increases regional patenting by around 3.25 per cent and raises the likelihood of a region developing a new technological specialisation.”

For an accountant who wants to drive clients to achieve their full potential, knowing this could shape the way in which advice and support are given.

Innovative businesses face the same economic challenges as any company, so making decisions about how and when to conduct R&D is driven by finances as much as by science.

If an innovative business is looking for additional sites to conduct R&D work, an accountant will likely be part of the conversation anyway as the ability to fund this expansion is discussed.

Knowing that the region chosen could yield both economic and scientific returns means that these decisions should be given more weight.

This is especially true as the way in which R&D funding is currently being adjusted now places a greater emphasis on regional investment and pushing researchers towards specific types of projects.

How do R&D tax reliefs fit in with regional considerations for R&D?

Not shackled to a specific location, R&D tax reliefs simultaneously add to and break away from the regional considerations that should be informing R&D decisions.

For businesses that are able to align with the R&D preferences of their neighbours, R&D tax reliefs will continue to provide a way to further enhance the support they receive.

As an area becomes more effective at research, there might be greater scope to spend additional funds engaging with projects that may not be possible elsewhere in the country.

Meanwhile, businesses that are going against the grain may appreciate a form of support that empowers them to find their own path.

R&D tax reliefs reward the work that is conducted purely for the sake of advancing the field of science or technology – there is no need to be aiming for a project that aligns with the current Government’s strategy for R&D.

All types of businesses benefit from making the most of R&D tax reliefs and this is best achieved when R&D tax consultants and accountants work in tandem.

Our expert team can work alongside you to empower clients to make the most of the innovation funding available.

We know how to appraise a project to determine its eligibility, understand where qualifying costs are being incurred and write a technical report that captures the R&D in a way that HMRC can understand.

As an accountant, you can help clients with R&D by accurately compiling the figures that underpin these qualifying costs and engaging in conversations about R&D as early in the accounting period as possible.

HMRC prefers R&D tax reliefs to be submitted with the original tax return as it demonstrates an active commitment to research that is not shown when it is done as part of an amendment.

Being proactive can make the process more efficient and help a client get their relief sooner, with a slightly reduced chance of enquiry.

The way in which R&D is conducted throughout the country changes due to the investment strategies of the Government and other key bodies, so knowing how to make the most of what is available can be the difference in helping a groundbreaking advance come to fruition.

Wherever your accountancy firm or your innovative clients are based, get in touch for expert R&D tax relief support.  

Adam Bointon

Adam Bointon is a Technical Director specialising in R&D Tax Credits for SMEs in manufacturing and software sectors. With over 15 years’ experience, he works closely with businesses to identify qualifying R&D activities and prepare clear, compliant claims. He combines technical expertise with a strong understanding of economics and finance to support successful outcomes. Adam also contributes to industry webinars and CPD sessions, sharing insights on R&D tax relief and HMRC requirements.