Who is indirectly involved in R&D work?

With operational costs getting higher, businesses may be finding it harder to keep up with the financial pressures they are under.

One of the true strengths of R&D tax relief claims is the accessibility of funds for innovative businesses that would otherwise struggle to make back any of the costs incurred doing R&D.

It takes a village to conduct R&D and some staff members will be in the spotlight while others take on a more backstage role.

It is those supporting staff who are often overlooked in an R&D tax relief claim, but it is worth understanding which staffing costs can actually be included.

What counts as indirect involvement in R&D?

While the team of scientists or engineers who are working to develop a groundbreaking piece of technology or uncover an earthshattering dimension of knowledge will be considered, there are plenty of people who enable that work.

There may be a person in the research team dedicated to keeping detailed notes and records to guide the researchers and help them deduce where the problems are arising and how to address them.

Long-time readers of our blogs will know how strongly we recommend detailed record keeping as a way of improving the health and integrity of R&D tax relief claims and it is reassuring to know that the person doing this work can be included in the claim.

So too can the IT support staff that keep the technology operating, such that breakthroughs can be made.

Tech problems can strike anyone at any time, just ask the astronauts of Artemis II for their recommendations on email clients, so it is logical that the staff in place to resolve these are also valued.

The HR and finance teams that keep the project funded and populated can also have their work included as without them there would be no staff in place to conduct research.

Security and maintenance staff are also eligible for inclusion, which is a kind way for HMRC to acknowledge that R&D is only valuable to a business if it is not stolen.

How can indirect staffing costs be included in an R&D tax relief claim?

As with direct staffing costs, only the amount of time a person spent supporting R&D work can be included in the R&D tax relief claim.

This means that some administrative staff will have very little time and cost assigned to them if they are only engaged in a small way.

Conversely, a dedicated record keeper may have a significant amount of their time allocated to the projects on which they work.

It may be more challenging to allocate these costs as the staff may be less aware of their involvement than the direct staff.

As R&D tax consultants, we want to help innovative businesses fund the next chapter of innovation.

This means fully embracing the scope of R&D tax relief claims and not leaving valuable costs on the table.

For accountants looking to help clients with R&D, it is also worth considering the full scope of eligibility so that discussions can be more productive and fruitful.

Every person who contributes to an R&D project has the opportunity to be featured in an R&D tax relief claim, such that the business can continue to benefit from their hard work.

For support with R&D from our talented team to yours, get in touch.

Adam Bointon