A hearty recipe for getting the most from research and development in a business. Some think they don’t have an R&D claim. This is often not the case.
Serves a business of any size.
Ingredients
- One business
- One or more projects to improve or develop new products or processes
- Money spent on the above project
- Employees dedicated to making the project happen
- An R&D tax specialist
Timing
Preparation: Up to a few weeks.
Time to success: As little as 6 to 8 weeks if you get it right.
Method
- First understand the project in your business and how it relates to R&D. Speak to Lumo and in less than half an hour we can let you know if you have a valid claim.
- You should also speak to your R&D specialist about any claims that you may have from the last 2 years that haven’t been submitted. Although claims can go out of date, they are good for the current tax year and the previous 2 tax years. Anything older than this will have to be discarded.
- Then gather the figures to support the claim. These can be gained from your accountant or from your annual return. They will support the R&D tax claim by backing it up with financials.
- Now make sure you check this part of the recipe as the last thing you want to do is leave anything behind before pouring into an envelope to send to the tax man. Getting the most from any claim is a vital part of making this taste as good as it can be.
- Add to this a pinch of explanation. This is the 2nd form required by the HMRC and shows what the project was about. This is vital to help the tax man understand why the project qualifies for a tax return.
- Next put the two together and send off to the HMRC for processing. This doesn’t take as long as it sounds, and many claims are back within 6 weeks.
- While waiting, think about how all of this fits into your business plan. Preparing for the return of the claim is an important part of this recipe. It may come back in the form of money off your next tax bill or a cash lump sum. You should know what you are going to do with the money that come back to your business. Making this a recipe you can enjoy year after year comes from making research and development an ongoing part of your business plan.
- Finally, prepare the business for the cash injection from your R&D tax claim. Once you are ready and the claim comes out of the tax man’s oven you should put it to good use as soon as possible.
Best served with a smile and a side garnish of celebration. The average size of an R&D tax claim on behalf of our clients is over £35,000, so well worth breaking out the bubbly for.