R&D tax credits are an invaluable financial aid that can provide a lifeline for those in the manufacturing and engineering sectors, but is often overlooked by those operating in fields where their eligibility is not quite so obvious. Companies can avoid missing out on potential returns or over-claiming by seeking professional advice.
An accurate claim requires more than just knowledge of the scheme. Many companies make the common mistake in believing that because it has “tax” in the title R&D tax credits are best left up to their accountant. Unfortunately, in this instance wisdom runs contrary to popular belief.
The starting point is to ask the question ‘Are we really doing this in the most time-efficient and beneficial way possible?’ The key elements of the process are:
1. Identifying which of your technical activities are eligible
2. Quantifying eligible expenditure in line with the legislation
3. Submitting the claim and managing any additional actions from HMRC
The answer depends not only on the size of the claim, but also the way in which it is prepared for HMRC. Often clients make sizeable claims, but in the process invest far too much time on unnecessary detail and comprehensive documentation. Once internal costs have been accounted for, they realise that they could’ve spent that time more profitably elsewhere.
Conversely, some clients attempt to skimp on claim preparation time and hope to ‘claim just for the lion’s share’. This can lead to cases where the claim is either far smaller than it should be, or is large relative to company size but unsupported by sufficient detail – and this can incur issues with HMRC’s specialist R&D inspectors.
The Benefits of outsourcing to specialist consultancies
Working with a true specialist with knowledgeable and experienced people will almost certainly minimise the time and effort for you. R&D tax relief can be complex and time consuming, but if you choose the most appropriate approach and advisor it can be highly worth your time, but consider your options carefully.
When considering taking professional advice on R&D tax credit it’s important that companies think about the nature of support and the level of support they will get from their adviser:
Companies have to be aware that service providers approach the process differently, each has their own approach and the approach can have a profound impact on the results. Not even all R&D tax advisers provide the same service.
Companies should ask some pertinent questions through the selection process, to identify just what level of service and support they will be getting:
MAXIMISE YOUR RESULTS
Involving a specialist advisor for your claim means that your claim will be more efficient. You will benefit from the specialist’s tried and tested template and receive support from their team to guide you through any questions as you compile the claim.
Jumpstart is partnering with Company Connecting. It is a leading R&D tax relief specialist, guiding companies through the complexities of submitting claims to HMRC. Since its inception ten years ago, Jumpstart has realised over £100 million benefit for its clients.
Quote “Company Connecting” to get a free R&D tax credit consultation and analysis of the potential returns you might expect, contact the Jumpstart team on 0131 240 2900 or firstname.lastname@example.org.
e-mail us on email@example.com
call us on 0845 643 5375
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