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Part one: your ‘who’ questions answered

There are plenty of myths and an air of mystery surrounding R&D tax relief. It’s estimated that around 80% of eligible businesses are underclaiming on tax credits they’re due from the government — or aren’t claiming at all. Here at Easy R&D, we’ll ensure you’re not one of them and that you get maximum return.

The three main reasons we hear for not claiming are:

  1. They’ve never heard of R&D tax relief
  2. If they have, they think it’s just for scientists or specific narrow sectors
  3. They don’t believe the work they’re doing counts as R&D 

You could also be missing out on thousands of pounds. The government will even reward you in tax credits for R&D failed projects

In a bid to make R&D tax relief more transparent, banish the myths, and put money back into your business, we’re going to take things back to basics with the five Ws:

  • who
  • what
  • when
  • where
  • why

In our first instalment, naturally, we answer a familiar ‘who’ question on R&D tax relief:

Who can claim R&D tax relief?

Contrary to popular belief, you don’t need to be scientists donning white coats and goggles — huddled around Bunsen burners in laboratories. The notion that the white coat wearers are the only ones who do R&D, or do more R&D than anyone else, is a common myth that we’re eager to banish.

The latest HMRC data shows top three sectors to claim are: 

  • IT and software, 23%
  • manufacturing, 23%
  • professional, scientific and technical, 19%

These industries claimed 65% of all R&D tax relief claims for 2018/19. Yet, you may be surprised to learn that some big claims are going on in real estate, finance, insurance, education, arts, entertainment and recreation.

Up and coming niche industries include vegan food, drones, and baby tech; think Fitbits for babies.

Some of the biggest industries for the 2020s might not even exist yet. This decade promises to be a fascinating time ahead in the world of technology and business.

From building boats to powering concerts, a business in absolutely any industry can claim, providing it’s:

  • a small or medium-sized enterprise (SME), which the HMRC defines as a company with fewer than 500 staff and a turnover of less than €100 million, or gross assets of less than €86 million

R&D is the development of new products, processes, software or services — or making changes to existing ones while making an appreciable advance in science or technology. The HMRC’s criteria for claiming is purposefully broad and could be a little as making children’s stickers stickier.

If you don’t believe you’re eligible, then you could be wrong. If you do think that you’re eligible, then you’re probably right.

But don’t just take our word for it. Get in touch, and we’ll find out for sure.

 

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