The Government’s mission to Make Britain a Clean Energy Superpower – supported by the Clean Power 2030 Action Plan – suggests sustainable energy is set to become a leading sector in research & development (R&D) tax relief.
With only five years to meet Clean Power 2030 targets, the Government will be investing an average of £40 billion into sustainable energy infrastructure and research projects every year.
Therefore, there is great potential for sustainable energy businesses to engage in research activity and claim thousands of pounds in R&D tax credits.
A successful claim could leave your client thousands of pounds better off, boosting the level of capital they can reinvest into their business.
However, we know that R&D for accountants can be challenging, since most lack the time or specialist knowledge to navigate the complexities of the R&D tax relief scheme.
At randd uk, we have a proven and lengthy history of helping accountants secure tax relief for their sustainable energy clients.
What kind of sustainable energy activities qualify for R&D tax credits?
The sky’s the limit when it comes to R&D activities in the sustainable energy sector – as long as they meet the qualifying criteria.
As a reminder, in order to qualify for R&D tax relief, a research project must:
- Seek an advance in science and/or technology in an overall field.
- Involve scientific or technological uncertainty.
The claimant must be able to explain the work they did to overcome the uncertainty.
Examples of eligible R&D activities in the sustainable energy sector include:
- Producing items more cost-efficiently with high safety standards.
- Overcoming uncertainty such as weather interference and environmental concerns.
- Achieving scientific or technological breakthroughs in renewable energy generation.
- Developing new storage technologies for renewable energy.
- Building and testing new tidal power energy systems.
- Improving energy efficiency and reducing carbon emissions in existing systems.
Remember that you can even claim R&D tax relief on costs arising from unfinished or abandoned research projects.
randd uk’s R&D tax consultants can help you understand whether a sustainable energy project qualifies under the scheme.
What costs can be claimed?
Eligible costs for R&D tax relief in the sustainable energy sector include:
- Consumable materials.
- Software and equipment used directly in R&D activities.
- Wages, National Insurance, and pension contributions for staff directly involved in R&D work.
- Power and utilities used in the process.
- Subcontracted and external staff costs.
Our specialist R&D tax consultants can help you identify qualifying costs.
How do I claim R&D tax relief for my sustainable energy client?
With the Government actively investing in and encouraging sustainable energy innovation, R&D tax relief provides an excellent opportunity to access financial support for research projects.
Accountants looking to claim R&D tax relief for their sustainable energy clients need to submit a detailed report outlining their R&D activities, the technological challenges faced, and how the project aimed to overcome them.
While the process can seem complex, working with an expert in R&D tax claims can simplify the process and help ensure that all eligible activities are captured.
At randd uk, we offer a bespoke and tailored service to maximise your client’s claim.
We offer accountants R&D assistance with all aspects of the process, from preparing a robust claim to resolving any challenges from HMRC.
Get expert support with your client’s R&D tax claim by contacting our specialists today.
