HM Revenue and Customs (HMRC) have recently revealed the national statistics for Research and Development (R&D) Tax Credits claims across the UK and these prove an interesting read. Haines Watts Liverpool are encouraging all businesses across the region to take advantage of what could be a very valuable tax reduction or cash refund, in reward for their innovative work.
R&D Tax Credits are one of the most valuable forms of tax relief available to SME’s and was implemented to encourage more investment into innovation across the UK. Your company can make a claim providing it is liable for Corporation Tax. The liability is then reduced by an amount equal to a percentage of the company’s allowable R&D expenditure. A company with no tax liability can still make a claim to receive a cash payment.
Dave Waddington, Tax Partner at Haines Watts Liverpool, said “Although more and more businesses by the day are taking advantage of the savings available, these statistics highlight an opportunity for those companies that have yet to make a claim to do so sooner rather than later.”
There has been a common misconception in the past that R&D is only available to specific sectors, this is incorrect. The truth is that any limited company that can show they are making improvements to their products, processes or services are eligible to qualify for R&D Tax Credits. The guidelines define this as a collection of ‘activities conducted to a method or plan in order to achieve an advance in science or technology’.
Dave Waddington continued “It is due to this lack of understanding and guidance surrounding eligibility, that there are still so many businesses in the North West, missing out on what could prove to be a substantial amount of tax relief.”
Although the main industries who apply include manufacturing, information & communication, professional and scientific & technical, (together making up 73% of claims made and 75% of the total amount claimed during the 2015/2016 year), there are many other industries who have been taking advantage of R & D tax relief. Yours could be one of them!
Dave Waddington added: “The majority of businesses in most sectors are eligible for the savings available. We would urge you to get in touch with us to discuss the opportunity of a claim as soon as possible. In particular, if you have recently enhanced your products, explored new materials, improved efficiencies or solved any technical issues.”
Haines Watts Liverpool works with a large number of diverse businesses, not only within the North West but nationally. We have so far helped hundreds of businesses save millions of pounds. With our office at the heart of Liverpool City Centre and the fact we offer a full range of services to all owner-managed businesses, including Accountancy, Audit, Tax Compliance and Payroll, we are here to help you with the successful and efficient growth of your business.
"The majority of businesses in most sectors are eligible for the savings available."
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