What is research and development? It depends entirely on who you ask. A Technical Director is likely to set the bar higher than a Financial Director. Someone in the metal forming industry will probably set the bar lower than a counterpart in the space industry. So, who’s assessment is correct?
HMRC lists no less than 43 points that must be considered in order to form an accurate and defensible judgement on whether an activity can be classed as R&D for tax purposes.
Did your accountant or anyone in your business use these guidelines when deciding what to exclude from your R&D Tax Credit claim? The answer when we ask face to face is almost always ‘no’. The few that reply with a ‘yes’ often quickly follow up with an admission that they aren’t convinced their interpretation of the guidelines was correct.
We say it time and again, R&D Tax Credits are 90% about the R&D, the technical stuff, the correct identification of eligible R&D to ensure your claim is robust and will withstand any future HMRC scrutiny. Whoever makes that call needs to be prepared to own that decision if HMRC come knocking.
Too often we are told that ‘our accountant handles our R&D Tax Credits’….but do they? Really?
Think about it, who decides which projects or sub-projects get included? Who trawls through spreadsheets trying to figure out how much time Gary spent writing that bit of code? Who makes the judgement call about what proportion of equipment costs can be attributed to a project? Who decided to not even mention the client led projects where you were on a daily rate?
The odds are it wasn’t your accountant.
So, when HMRC invoke a company-wide investigation due to errors in your R&D Tax Credit claim, who is going to step forward and own those claim documents?
So, let’s ask the question again, who handles your R&D Tax Credit claims?
If you’re starting to question whether you’ve…
- made the most of what’s available to you
- positioned your business as a sitting duck
- paid for a service from your accountant that you’ve not really received
…then we suggest you speak with us.
MSC R&D work with R&D Tax Credits week in and week out, explores the meaning of R&D in the context of R&D tax credits. We have Technical Analysts that have a deep understanding of your industry and the technologies you’re working with. We have Financial Analysts that specialise in R&D related tax regimes and understand how they impact on more general accounting matters.
As we do all the work we ‘own’ the claim documents, we stand at the front of the queue to defend our work should we ever need to. Perhaps best of all we don’t charge you a penny until you see the financial benefit that we deliver.
If you’re unsure about your historical claims, let us take a look for you.
Or if you would like to hear about us from one of our clients, please visit: