Posted on 26 February 2013
Research & Development Relief (RDR) is a Corporation Tax claim made annually that may reduce your company’s tax bill or indeed produce cashflow for your business.
The RDR scheme has been designed to encourage greater R&D spending and based on recently published figures only 3% of eligible SMEs in the UK are taking advantage of this tax relief.
Why aren’t companies claiming?
Many businesses, particularly SMEs, are failing to capitalise on the full tax benefits of R&D. This is due to a number of factors including:
a lack of awareness of the tax reliefs
a lack of understanding of how it works and how to claim
poor professional advice
jumping to an incorrect assumption that you won’t qualify!
Surprising but true...some real examples
Company A who provide equipment for racing events recently had to make changes to their existing equipment to meet the specific needs of a race. This tailored service is something they have offered clients for a long time now and so, didn’t consider the alterations to the equipment to be R&D.
However, by putting an RDR claim through, Company A received £12,000 of their tax back!
Company B who run an online shopping service selling DIY and home products have made some changes to their payment platform which having conducted an initial assessment, has enabled a claim for a tax credit.
Our tax experts make the entire process of securing RDR achievable and simple for our clients. Our comprehensive service starts with an initial assessment determining which of your R&D activities qualify for the scheme. We then gather and draft your claim and submit this to HMRC.
If you think you might be able to submit a claim, or would like just to chat it through, then please contact your partner or one of the SC Tax Advisory specialists by clicking on their name below:
Richard Stanley - Tax Partner
Clare Beachell - Tax Partner
Edward Saunders - Tax Director