It rewards companies conducting self-funded R&D work, regardless of whether they are in profit or loss. HMRC statistics show that 16,160 small companies received an average £49,505 in cash payments or tax relief from this government scheme.
Typical R&D projects include in-house software development, engineering design, new product development, solving manufacturing problems and developing new processes. However, estimates indicate that 90% of eligible businesses are unaware they can claim.
To access R&D tax relief, a company needs to prove to HMRC that their technical innovation meets the current legislation and the DBIS guidelines.
The guidelines are for the purposes of Section 837A Income and Corporation Taxes Act 1988. In this context “research and development” is defined for tax purposes and given legal force in Parliamentary Regulations.
Here at MPH Accountants, we understand the details of the legislation and can compile a technical report for HMRC that explains how a company meets the criteria. We also calculate the qualifying costs and submit the relevant documentation to claim back R&D costs in cash or as tax relief.
Our service includes support if there is an enquiry from HMRC through to its successful conclusion.
