R&D Tax Credits

Tax Question

What are R&D Tax Credits?

Tax Answer

R&D Tax Relief is a government incentive which was designed in 2000 to encourage companies to invest into innovation and increase spending on R&D activities. The government can offer your organisation an opportunity to claim back an amount of your R&D expenditure as tax credits.

R&D Tax Credits

The idea of R&D tax relief does not cross a lot of minds. Expenditure into the area of research and development has become common amongst companies but still only a few are taking advantage of the generous corporation tax relief.

Some companies may think that they do not do R&D however, when taking a closer look, it is often found that a lot of day to day activity being carried out qualifies as R&D which makes them eligible for a claim. In addition to this, are a lot of companies are not claiming their full entitlement.

How does R&D Tax Relief work?

For the SME scheme, R&D relief is available at a rate of 230% of the qualifying expenditure for instance, 33p of every £1 spent can be claimed. However, for those on the Large Company Scheme the rate is available at 130% of the cost. Associated Capital Expenditure can immediately be relieved through Research and Development Allowances at 100% of the cost.

What qualifies as R&D expenditure?

It is important that the product or service that you include as part of your claim really is innovative and at a technological level. We can work with you to gather this evidence in order to meet HMRC’s criteria.

How Vantage Fee Protect can help you claim

If you have not considered R&D tax relief yet, you could be missing out on a great opportunity. Many claimants can receive tens of thousands of pounds a year in the form of a corporation tax deduction or a cash repayment and this could be you!

It is also possible to make retrospective claims for the last two accounting periods, therefore it is important to act immediately to establish a valid claim and potentially secure a refund of corporation tax already paid to HMRC.

Research and Development Tax Credit

You’d be surprised at the wide range of sectors which qualify for Research and Development Tax Credit claims, one of which could include your sector. Our specialist Tax team can help you through the process and guide you through the following:

  • Identifying whether your business is or has been investing in qualifying R&D activity
  • Which costs qualify for R&D tax relief
  • Drafting R&D technical reports
  • Submit your R&D tax relief claim
  • Work with HMRC to agree your R&D tax relief claim

Here are just a FEW examples of the sectors that qualify for R&D tax relief:

  • Automotive Industry
  • IT hardware
  • Insurance brokers (software development)
  • Property and construction
  • Banking and Finance
  • Health
  • Food and drink
  • Manufacturing
  • Printing and packaging
  • Alarm and CCTV
  • Construction and building materials
  • Computer hardware, electronics and software

Looking for a Research and Development service?

Please fill in the form below and the Vantage Research and Development team will be in touch to discuss your R&D requirements.

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