This article will break down the various types of tax reliefs available to UK businesses undertaking the process of research and development.
Companies that are innovative and undertake eligible R&D activities are eligible for the relief. Under this, they can claim up to 33% of the expenditure as a cash tax credit from HMRC.
What are R&D Tax Credits?
The R&D tax credit is a program by the UK government that seeks to incentivise companies working in innovative fields by rewarding them. HMRC does this by granting companies a tax deduction, or a tax credit (in situations where no tax is incurred).
An R&D Tax Credit is a cash payment provided by HMRC to eligible companies. Companies generally include their claim for an R&D Tax Credit when they file their accounts and submit their CT600 to HMRC at the end of their financial year.
What kind of businesses are eligible for an R&D Tax Credit?
The tax credits can be claimed by a range of companies that seek to make an advancement in their field through the process of researching into and/or developing new technologies, regardless of what industry that may be. However, to truly stimulate and encourage research and development, the government has made it possible to claim relief on unsuccessful R&D projects too.
What is required for an R&D Tax Credit?
Any company in any industry can qualify for R&D Tax Credits. However, in order to meet the requirements, the company must have participated in qualifying R&D activities, including:
Creating new products, technologies, or services
Developing or modifying existing products, technologies, or services
For more information, Adsum recommends you visit the HMRC website here.
The Problem with R&D Tax Credits
However, the process of applying and actually having the money reflected in your account is usually very slow and tiresome, which is why several high profile UK businesses choose to instead access their R&D Tax Credit from Adsum. With our tech-based solutions you can:
Speed up further R&D activities;
Expedite commercialisation plans;
Meet ongoing cash flow needs;
Delay or avoid expensive equity raisings.
Access your R&D Credit with Adsum’s tech-based processes today. Based on your claim on the tax return filed by your accountant, Adsum can advance your R&D tax reclaim in as little as 24 hours.