R&D Tax Credits…What is it All About?
80% – 90% of companies which qualify are missing out.
The R&D tax credit incentive is a hugely valuable tax relief available to most companies. They reward profitable companies with a significant corporation tax reduction or provide loss making companies with a much needed cash payment. Companies can use the cash benefit in any way they choose – even to pay a dividend! So why do so many qualifying companies not claim?
Companies can use the Cash Benefit in any way they Choose
Even to pay a Dividend
It is widely understood that somewhere between 80% to 90% of companies which qualify for the relief do not make a claim. With the average value of a claim being around £49,000, these companies miss out on the opportunity to reclaim tens of thousands of pounds each year.
From our experience, the primary reason for this high percentage is associated to a lack of understanding – either companies do not realise that they qualify or they wrongly believe that the process is too complicated. This is simply not true.
How can LimestoneGrey help?
LimestoneGrey specialise solely in R&D tax credits. It's is all we do.
LimestoneGrey specialise solely in R&D tax credits. This is all we do – day in day out. We pride ourselves on our ability to simplify the claim process. By specialising wholly and exclusively in R&D tax credit claims we have gained a thorough understanding of the legislation and what HMRC require. We have been able to develop a bespoke approach which simplifies the whole process, making the claim process easier and more accessible.
We even work on a no win no fee basis – you really have nothing to lose.
Do you Qualify?
To qualify for the relief, you need to have a project which involves scientific or technological uncertainties. Don’t worry, this is more straightforward than it sounds.
A project could involve:
- creating something new (for example, a new product, piece of software, process or service)
- improving something you already have
- duplicating something already available in the marketplace (for example, duplicating a rival’s breakthrough where the knowledge of how they did it is a trade secret).
To survive in today’s marketplace, most companies need to continually undertake a range of different projects to stay competitive. It is likely therefore that you are already doing one or more of the above.
However, simply having one of the above projects does not mean that you qualify for R&D tax relief. It is essential that the project also involves a degree of risk and uncertainty.
These uncertainties are the challenges or hurdles associated with the project, challenges which competent professionals at your company will need to overcome to get to the finish line. These uncertainties cannot be easily overcome by using their knowledge, skills, experience or publically available information (e.g. by finding the answer on Google). An element of trial and error is needed, which could include constructing a few prototypes, implementing a testing programme, or developing new algorithms for software development. The costs you incur in overcoming these uncertainties can form the basis of an R&D claim, allowing you to recover thousands of pounds each year.