Why Get Advice On R&D Tax Relief?

R&D tax credits are an extremely helpful resource for companies wanting to get a new product into development but struggling with finances. These credits are a UK government incentive which allow small- and medium-sized enterprises to claim back tax on their R&D expenses in order to help them achieve their full potential. Good for the UK economy and good for your business – a win-win situation for everyone, you would think. Surprisingly, though, there are still a huge number of small businesses out there still unaware that this kind of help is available to them. And even if they are, they may simply not have the necessary know-how to apply for it successfully.

If you think your company may be eligible for such tax relief and you urgently need it to take your new product ideas to the next level, it may be time to get some expert help. The ins and outs of the tax system can be pretty incomprehensible to those who haven’t studied it. Luckily, there are firms out there which specialise in offering advice and guidance on R&D tax credits, hopefully enabling you to make a successful application on behalf of your business and get that new product or innovation off the ground.

To begin with, the firm acting on your behalf will be able to ascertain whether you are even eligible for R&D tax credits in the first place. If you are, you can claim up to 225 per cent tax relief on qualifying research and development expenditure but this usually applies to companies with 500 employees or less. This can save you time and money straight away, because there is no point spending ages going through the application process if it turns out you don’t qualify for R&D tax relief after all.

If it is established that you are indeed eligible, then an advisor will also be able to work out all your qualifying costs – something many companies forget to take into account. The qualifying costs are related to certain technical developments your company will have to undertake to deliver improved products, processes or services etc. This will obviously require some investment, and an expert in the qualifying process should be able to lay out for you how much this is likely to be.

The preparation of the claim itself will require a lot of paperwork, negotiation and familiarity with UK tax law, which can be daunting to the novice. Helping you get through this is the most important service an R&D tax credit advisor will provide. If you try to do it yourself to save paying an outside agent then there is every chance you will miss a crucial detail and your claim will be rejected. In the long run, it’s better to make that initial outlay to ensure the job is done thoroughly. Then you will be well on the way to taking the next steps to achieve your long-term business objectives.