Businesses
and startups are facing a range of new financial challenges in the wake of
Covid-19. Our Building Future Resilience webinar series was packed full of
information and advice to help, so if you missed the series or are looking for
a reminder on the topics covered, we have collated a snapshot of key learnings
here.
What are
R&D tax credits? Research and
development (R&D) tax credits are a government incentive designed to reward
UK startups and companies for investing in innovation. They can provide an
important cash boost for businesses and be an effective way of supporting the
scaling up of your startup, through boosting your R&D and expanding your
team. Companies that invest in their innovation by producing new
products or further developing existing products are eligible to make a R&D
tax credit claim. So, is it worth it? RDVault, provider of the world’s only fully integrated R&D tax credits claim software, have shared a
couple of key points:
- The government’s definition of R&D is intentionally
broad – which means you could be carrying out qualifying activity and be eligible
to make a claim. The government’s guidance is here.
- Your
business must be based in the UK to be eligible for R&D tax credits – but
that doesn’t mean your R&D has to be. Companies with development costs
overseas can still make a claim
- R&D
Tax Credits can provide, up to £55,000 per claim per year
- HMRC have been
consistently processing R&D claims to their target of 28 days
- You can still make an
R&D claim even if you are in receipt of grant funding to accelerate
your innovation
- It is possible to
receive a claim sooner than you would usually expect. For example, many
providing lenders offer a R&D drawdown loan to help you while you
through the processing time, as long as you spend the loan on R&D and
can quantify how much you expect to receive back from your claim
- Companies in receipt of
a Bounce Back or Coronavirus Business Interruption Loan Scheme loans (CBILS)
can still make a claim – as long as they spend the money received on
R&D
- A claim can include the
costs incurred from staff salaries, subcontractors, materials, software,
and reimbursed travel
- Elements of a large
capital expenditure (eg expensive machinery) could qualify for R&D tax
credits.
To learn more about R&D tax credits, visit the gov.uk website here.
