Time to claim R&D tax credits: This is not a drill!
Written by Sam Warburton at randd uk
Now is the time to reward your investment in innovation. Your business could be entitled to cash awards for work that you’ve already done. Did you know that the UK construction industry claimed a total of £80M in R&D tax credits but are still under claiming as a sector? (Latest figures from HMRC statistics) Keep reading to drill into the depths of the R&D tax credits scheme… hopefully we won’t bore you.
1. Build up your business
I suppose the first question you may be wondering, is why bother learning more about R&D tax credits? Basically, it’s free cash with no strings attached and no obligations. Improve your cash flow, financially sustain R&D projects, recruit staff, invest in growth plans… what would you do with a cash injection in your business? Stay ahead of competition and strengthen your financial position, particularly as business owners face the effects of Brexit uncertainty.
2. Follow the yellow brick road
Although construction may not seem like an obvious sector for research & development, we have a significant number of clients within this industry. For example, an online brick merchant based in South Yorkshire have received £112,000 over four years. They claimed predominantly for bespoke software development that involved intense trial & error, testing and problem solving.
Another client received a first claim for £88,000 covering a two year period. This company regularly tackle large contracts that are technically challenging and absorb the financial risk of failure themselves. Many developments involve finding solutions to reduce waste, impact on the environment and downtime caused by construction work.
Based in Newark, Bonsers Restoration also successfully claimed R&D tax credits for development work required on historic grade I & II listed buildings. This involved substantial reverse engineering and material management to comply with strict conservation restrictions.
Richard Hill, Managing Director at Bonsers Restoration said that R&D tax credits enabled “the company to benefit by having an additional injection of funds within the company to make it stronger. With us, everything is put back into the business to make it stronger, better, healthier and to progress it forward.”
3. Tools for success
So what do you need to qualify for R&D tax credits? As long as you’re eligible for corporation tax and completing activities that classify as R&D under the scheme, you can be a company of any size and industry sector.
Examples of eligible activities include: bespoke solutions for building projects; trial and error for new materials that were previously untested in a construction environment; improving properties through energy efficiency, fire safety, plumbing etc.; and overcoming safety standards and industry regulations. Even if your innovation failed, your R&D tax credits claim could still be successful.
4. Don’t hammer your head against a brick wall
Seek expert advice to avoid a headache. For many finance professionals and Accountants, the R&D tax credits scheme is complex and many struggle to identify eligible activities, particularly in industry sectors like construction that are less likely to make claim.
Expert advice is also beneficial for optimising claim amounts without wasting time & effort that is better spent elsewhere in your business. Specialists can identify projects or expenditure that are less easy to spot because they recognise activities every day and have an outsider perspective. Specialist providers also have a rapport and credibility with HMRC, greatly improving your chances of success.
Want to start laying down the foundation for your claim? Request your free, no obligation eligibility check. Reference ‘Construction Article’ and call 01332 477 070 or email firstname.lastname@example.org.