WHAT are R&D Tax Credits
Research & Development Tax Credits are incentives offered by the government to encourage UK companies to invest in research and development (R&D) activities. Essentially, if your company is innovating or improving products, processes, or services, you may be eligible for tax relief. This means you could receive a reduction in your tax bill, or in some cases, a cash payment from the government. Such financial support can be used to further fund your R&D projects or grow your business. It’s a way for the government to support and reward businesses that push the boundaries of innovation.
WHY CHOOSE STAX?
We are a team of experienced professionals who specialise in navigating the complexities of R&D Tax Credits. With our deep understanding of the regulations and requirements, we will ensure that your claim is optimised for maximum benefit. We understand that every business is unique, which is why we take the time to tailor our approach to fit your specific needs and circumstances. You can trust us to provide personalised guidance and support throughout the entire claims process.
HOW DO R&D TAX CREDITS WORK?
R&D Tax Credits are a benefit provided to companies that invest in innovation, whether in developing new products, processes, or improving existing ones. Essentially, if a company spends money on research and development, it can claim R&D tax relief. This claim can result in receiving a cash payment or a reduction in Corporation Tax. The scope for identifying R&D activities is broad and applies across all sectors. Typically, companies can make claims for their last two completed accounting periods if they’re claiming for the first time.
Frequently Asked Questions
Developing new products, processes, or services, or modifying existing ones, may qualify for R&D Tax Credits. If your project involves uncertainties regarding its feasibility or implementation, this could indicate you’re addressing technological uncertainties, making it eligible for an R&D claim.
Determining eligibility for R&D Tax Credits involves assessing whether your company’s activities meet the criteria set by HMRC. Here at STax, we can help you with that.
Receiving R&D Tax Credits depends on a company’s profitability. These credits can be obtained through a Corporation Tax rebate, cash credits, or an increased expenditure that can be used to offset future profits for the business.
The scheme aims to incentivise innovation, not solely successful or finished projects. If the project expenses occur within the financial year you wish to claim for and meet the eligibility criteria, you are eligible to make a claim. For ongoing projects, there is potential for both past and future claims.
HMRC may conduct investigations into R&D Tax Credit claims to ensure compliance with the eligibility criteria and the accuracy of the information provided. These investigations are routine and aim to verify that the claimed R&D activities meet the required standards. Working with the team here at STax, can help ensure your claim is prepared accurately and withstands scrutiny.
