Why do so many companies not claim R&D relief?

Author

Andy Wood

Andy is a practical, creative tax adviser who assists a variety of clients in achieving their personal and commercial objectives in the most tax efficient manner.

  • Despite the potentially attractive levels of tax relief available… The statistics make it clear that R&D relief is hugely undersubscribed by UK SMEs.
  • There are potentially a number of reasons for this:
  • FIRSTLY – The definition of innovation– A business may simply not be aware that their activities qualify as innovation for R&D purposes.
  • SECONDLY – Qualifying expenditure – Identifying what costs qualify for research and development tax credits can be complex… and often leads to companies claiming for less than their full expenditure eligibility.
  • THIRDLY – Calculating the claimCorrectly calculating the amount of relief using the relevant rate across relevant accounting periods is NOT straightforward.
  • FINALLY – Making the claimTo support the claim, comprehensive documentation will need to be compiled and submitted to HMRC.
  • As a firm, we are experienced in holding business owners hands through the process from the feasibility stage to receiving the benefit of the claim.

 

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