Article originally featured on smallbusiness.co.uk
More than half (51 per cent) of SME business owners and managers in the UK have never even heard of Research and Development (R&D) tax relief, according to the results of a new survey published today by Catax, the specialist tax reliefs expert.
But with 57 per cent of respondents saying they have developed a new product or service, and/or implemented a new business process over the past two years — the basic requirement for an R&D tax claim — most SMEs would be eligible for tax relief.
And despite the Chancellor reiterating the importance of R&D in the Spring Budget, over four in ten SMEs (44 per cent) think it is restricted to specialist tech, drug and science companies. In reality, relief can be claimed by companies of all sizes from all sectors.
Two fifths (43 per cent) of UK SMEs also mistakenly believe that any eligible R&D activity has to be successful and integrated into a business for a claim to be made. This is not true: the outcome of the R&D is irrelevant – what matters is the time and money spent.
The ongoing lack of awareness around R&D and the eligibility criteria that apply to it is costing the UK’s SMEs potentially hundreds of millions in tax relief each year. To date, for example, the average tax benefit for clients of Catax is £39,000.
Click here for full article