How to navigate R&D Tax Credits to ensure your start-up can take advantage of this easy to access cashflow?
Our CFO, Paul Griffiths who is a veteran at advising companies on the mythical government initiative of R&D Tax Credits. He has listed his best practical advice on how to navigate this to ensure your start-up, with a little bit of work, can take advantage of this easy to access cash flow that really can make all the difference to keeping your start-up’s growth plans moving forward.
Research and Development tax credits are a UK tax incentive specifically designed to encourage companies to invest their time and £ in R&D. Companies are able to reduce their tax bill or claim cash back on a % of their approved expenditure.
First things first – to potentially qualify for R&D tax credits you need to be a UK company subject to Corporation Tax working in ANY field – Wine Making to Insurance to biotech all qualify, and of course you need to be spending money on qualifying projects.
HMRC has purposefully made the criteria broad – whatever your size or sector if your company is attempting to ‘resolve scientific or technological uncertainties’ then your project may qualify. The project itself can be a specific piece of work or in the case of a lot of start-ups, the entire business. The criteria cover creating new products, processes or services, changing or modifying an existing product, process or service, and even, if you’re not sure if your project is even possible or you don’t know how to achieve it in practice you could be resolving technological uncertainness. The research doesn’t have to be successful to qualify and you can include work undertaken for a client as well – very broad criteria!
Read more here