Companies in the Healthcare industry often spend a large portion of their time and resources on Research and Development (R&D). From testing a variety of new pharmaceutical products or improving current ones, to creating technologies or complimentary software – the scope of research and development available to be undertaken in the Healthcare Industry is one of the broadest in any given business sector. This industry is seen as a particularly fulfilling and positive one – you and your company could be pioneering the way into new technologies or advancements; that may see the betterment of lives of millions of people across the globe. It has the very real opportunity to change lives on a massive scale.
As you would expect with an industry with this level of social investment, the amount spent on improving or realising advancements, is quite substantial. Approximately 48% of the £16.5 billion invested in UK R&D during 2016 was spent on the Healthcare Industry alone.
It is believed that by 2018, the Healthcare Industry will surpass the computing and electronics sectors to become the largest R&D spending industry in the world (an estimated £108 billion v £104 billion).
Preclinical or discovery research, and clinical development are the areas where the majority of the Healthcare budget is spent. Under existing rules and legislation, much of the work done to improve or create new advancements is potentially eligible for tax relief under the R&D Tax Credit scheme.
Understanding what qualifies for relief under this scheme is therefore an important issue that you as a business will need to be aware of.
Qualifying areas may include:
- Developing new pharmaceuticals
- Improving current pharmaceuticals
- Conducting tests and reviews to ensure regulatory and legal requirements are satisfied for products in the UK and abroad
- Research to improve a product’s shelf life or stability
- Creating and testing prototypes for new products
- The manufacture of experimental clinical trial pharmaceuticals
- Designing and developing new medical devices, equipment or technology
- Enhancing current technology to work with new technologies or discoveries
- Function and performance tests of new medical machinery
- Improving pharmaceuticals to reduce side effects or required dosage levels
This is by no means a comprehensive list, but if your company is working to create new or improved technology or pharmaceutical products that either offer improvements on existing goods or an advancement in the industry, then your work is likely to qualify for tax relief under this Tax Credits scheme – it is also important to note that generally the success or failure of your R&D is not taken into consideration when determining if research and development was undertaken, so you will most likely not be penalised should you be unable to achieve the results you were aiming for.
R&D Tax Credits can also be claimed on the cost of employing staff who are directly or actively involved in carrying out the research and development, as well as the cost of the materials used, and in some cases – payments made to subcontractors that have assisted with the R&D procedure.
The tax credits scheme will allow you to claim a certain level of tax back, dependent on how much you have spent on research and development, and how much of those costs fall into the qualifying areas of the scheme.
Your business can claim up to 33% of qualifying expenditure or, in the case of your business making a loss – your business can claim up to 14.5% cash as a refund.
All claims made will be closely scrutinised by Her Majesty’s Revenue and Customs (HMRC), so it is important to ensure that you understand exactly what you are allowed to claim for, what is disallowed, and what the tax relief can be applied to. This procedure may seem complicated and not worth the time to complete, however there is help available in getting the tax relief that you are due.
Easy RnD can assist you in the process of claiming R&D Tax Credits – making sure that you claim for everything that your business is entitled to, and that all the paperwork required by HMRC is accounted for and correctly filled in.
Research and Development Tax Credits allow you to claim back or offset the tax relief granted against qualifying costs. Easy R&D can make sure that you are claiming everything that you are eligible for – and that you get all the tax relief that is due to you. Get in contact today to find out just how much you are eligible to receive.
Easy R&D have helped hundreds of companies to make R&D tax relief claims. Contact your nearest R&D Consultant to see if you can claim – 0800 195 7516