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How long will it take to claim r&D tax relief?

How long will it take to claim r&D tax relief?

RESEARCH AND DEVELOPMENT TAX RELIEF – HOW QUICKLY CAN I GET MY R&D TAX CREDITS?

From an initial meeting with you, claims take on average 8-10 weeks before the benefit is received.  So you understand what goes into this let's take a look at HMRC's processing time. 

HMRC R&D PROCESSING TIME

HMRC advise that the processing of claims can take between 4 to 6 weeks and is usually true for companies claiming tax credits.

There are various means for any claim to be processed by HMRC depending on its type and the final process can be dealt with by different departments.

For example, repayments of corporation tax are eventually processed by a corporation tax team and sometimes take longer. In addition, popular year ends (e.g. March and December) and national holidays can mean a delay in receiving your claim benefit. 

PREPARING THE R&D TAX RELIEF CLAIM YOURSELF

This time can be hugely variable, depending on the familiarity of the people building the claim and their understanding of the legislation. If you are looking at doing it yourself then you’d need a couple of months to fully read through and digest the legislation, then a fair chunk of time to build the technical narrative that the claim rests on. The accounting side takes less time, but of course is critical to get right. 

HOW LONG WOULD WE TAKE TO DO IT FOR YOU?

Companies can claim for the previous two years, meaning if your year end is December you have until 31st December 2017 to claim for the year ending 31st December 2015. This timing drives how urgent your claim submission is.

After our technical meeting, we write the claim and the majority of those are submitted on your behalf within 4 weeks, with very little further input from you. If timing is tight, however, we can deliver quickly for you - we haven’t missed a deadline yet.

Interested in talking to one of our Tax Advisors to find out what your claim could be worth?

Book a free consultation with us:

 

 

Autumn Statement & spending review – R&D relief and spending

Autumn Statement & spending review – R&D relief and spending

The press headlines are focused on the personal tax credits and how the cuts have been shelved, with the new forecast from the Office for Budget Responsibility forecasting sufficient extra income to persuade the austerity to look elsewhere and save some political face.

Conspicuous by its absence though was mention of the R&D tax credits and relief. Having received a boost in the last budget announcement they were left well alone in the review, and remain a strong and highly effective incentive for technically minded companies. When done professionally they can reduce tax bills, provide cash from loss and allow greater investment in new development work. Ask us how we can help you access it.

A brief summary of the increases in R&D spending announced

·      Science resource funding to rise in real terms to £4.7 bilion per year for the rest of the parliament.

·      A new body is planned to be introduced, called Research UK. This will work strategically across the seven Research Councils (science focused funding and steering bodies), taking a longer term view. Innovate UK helps commercialise technology; this body will be incorporated into Research UK but still exist.

·      There is already a government commitment to spend to build the UK’s research base, to the tune of £6.9 billion between 2015-2021. Around £150 million (total capital and resource) will launch a competition for a Dementia Institute, to build on the UK’s strengths in medical research.

·      The “Northern Powerhouse” gets its own investment fund of £400 million to invest in smaller businesses. The Enterprise Zones programme for the Northern Powerhouse will also be doubled in size with 7 new zones and 2 extended. The government will also be providing £50 million for 2 new agricultural technology centres in York for the food and farming supply chain.

·      Good news for the north continues, with £15 million of funding to support further Northern Powerhouse trade missions including to key emerging economies, and £7 million for a “Northern Powerhouse Investment Taskforce”, to bring “the authorities and businesses of the North together to present a single internationally competitive offer to the world.”

·      Over £130 million capital will be invested in Department for Environment, Food and Rural Affairs’ (DEFRA) science facilities, with £5 million specifically to further improve the HQ of the Centre for Environment, Fisheries and Aquaculture Science following its 5 year renovation.

 

The complete statement:  https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/479749/52229_Blue_Book_PU1865_Web_Accessible.pdf

 

0115 824 0402

 

Why not find out more about R&D Tax Relief on our blog

 

 

Research and Development thrives with R&D tax credit claims up by nearly 25%

Research and Development thrives with R&D tax credit claims up by nearly 25%

The heartland of UK industry is the SME, and latest government data proves just how much technology development is still performed in the UK. The government’s R&D tax relief is aimed squarely at companies developing new technology, rewarding them with tax breaks for the technological risks they take, from developing new farm equipment to blue sky biotech.

R&D tax claims have risen almost a quarter in the last year from around 16,000 claimant companies to 20,000, with claim values totaling £350m. Since 2000, 120,000 claimants have claimed £11.4 billion in tax relief.

Small and medium sized businesses have been the star performers of the UK economy in recent months with the majority of these claims made by SMEs, which rose by 23% and large companies rising 4%. 

The rise was seen across the country but with London, the east and southeast continuing to be the highest areas for claims at a total of 46%of all claims SMEs from the rest of the UK should really look into the R&D tax relief as many are missing out. A typical claim value is around 20p in every pound spent on development, usually repaid in cash by HMRC.

As the popularity of R&D tax claims rise, the chancellor took the politiucal opportunity last year to further boost innovation by announcing an increase in R&D tax credits to 230%. This means that for every £100 of qualifying costs, the corporation tax paid by SMEs on income could be reduced by an additional £130 on top of the £100 spent - which is great news for business.

 

0115 824 0402

 

NOTES:

SME –a Small to Medium sized Enterprise that is; less than 500 staff AND up to €100 m turnover OR up to €86 m balance sheet value

 

Why not check out our previous R&D blog post about how to prepare for a future claim