What is R&D Tax Relief
R&D Tax Relief is a Corporation Tax relief that may reduce your company’s tax bill or result in a payable tax credit. Depending on your company’s size, profitability, and the accounting period for which you are claiming, you could benefit from up to 27% of your qualifying R&D expenditure across relevant projects. This relief can help fund future innovation, reducing the risk of producing new products and processes.
WHY CHOOSE STAX?
We are a team of experienced professionals who specialise in navigating the complexities of R&D Tax within the world of construction with a team of Chartered surveyors and tax experts.
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 DOES R&D TAX RELIEF WORK?
R&D Tax Relief is 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
Examples of qualifying construction R&D are:
- Developing new or improved construction and engineering materials.
- Upgrading existing buildings with new or improved technologies.
- Adapting construction equipment and processes to meet new regulations, such as fire, health and safety, sound, and thermal insulation requirements.
- Designing and deploying new mechanical and electrical systems for buildings.Modifying existing building components and fittings to improve their performance or functionality.
- Developing new or improved construction equipment.
Receiving R&D Tax Relief depends on a company’s profitability. The relief can be obtained through a Corporation Tax rebate, cash credits, or increased expenditure that can be used to offset future profits for the business.
The scheme aims to incentivise innovation, not just successful or finished projects. If the project expenses occur within the financial year you want to claim for and meet the eligibility criteria, you are eligible to make a claim. For ongoing projects, you can potentially make claims for both past and future expenses.
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 becoming more common place and aim to verify that the claimed R&D activities meet the required standards. At STax, we take a rigorous approach to ensuring your claim is prepared accurately within current HMRC guidelines and withstands scrutiny.
