3 January 2018
Are you claiming your Research and Development Tax Credits?
HMRC’s latest statistics around Research and Development (R&D) Tax Credits have been published. The average value of a small and medium-sized enterprise (SME) claim is on the rise, and more SMEs than ever are making successful claims. However construction is still lagging way behind, despite being an industry defined by innovation and problem solving.
Build UK’s partner, the RIFT Group, has shared some of the most common myths to help change the perception of R&D tax credits:
Myth #1: if you’re not wearing a white coat and holding a smoking test tube, you’re not doing R&D
R&D is about solving problems through innovation. Whatever business you’re in, if you’re finding new, better or cleaner ways to accomplish something, you’re doing R&D.
Myth #2: claiming R&D Tax Credits means giving your secrets away for free
Making a claim for R&D Tax Relief does involve some HMRC paperwork. Like any other kind of tax relief, you’ve got to prove that you’re owed money to claim it back. As part of that, you need to explain what you’re trying to do and what problems you’re solving along the way. However, there’s no need to disclose confidential information to make your claim.
Myth #3: if your project fails, you can’t claim for it
The truth is that your claim is still valid even if the projects it covers don’t succeed. HMRC’s looking at the bigger picture with this scheme. The more companies in the UK are working on solving problems and making advances, the better. Sometimes, that work will pay off and sometimes it won’t. Win or lose, every project is valuable because even failed experiments teach crucial lessons.
Myth #4: R&D claims are more hassle to make than they’re worth
According to HMRC’s latest figures, an average R&D Tax Credits claim for a small or medium-sized enterprise comes to £61,500. It could well be worth a few hours work!
RIFT offers a 5% discount on their fee to all Build UK members and can provide advice and support to help you identify where you are undertaking research and development.