Hi new business owner, and first of all congratulations on taking the leap of faith and starting up your own business in the exciting and ever evolving world of food and drink.
Don’t worry, when we mention tax, we are not talking about the kind of tax which you have to pay out to the tax man. Research and Development Tax Credits are a UK government incentive which gives money back to businesses if they are eligible. If your company is a start-up we think this might just be you. Keep reading to find out why.
A cash injection would be so useful right about now wouldn't it? So what exactly are these R&D tax credits?
Research and Development Tax Credits are a UK government tax relief that rewards innovative UK companies. These are those forward thinkers who are investing in new product development, new processes or enhancing existing ones. A business needs to submit a claim to get this money back, which is on average as much as one third of every £1 of qualifying costs.
It has been estimated that only 1% of eligible research and development tax relief claims for the food and drink industry have been paid out. You could be one of those 99% missing out.
What makes a business eligible for this reward?
As we previously mentioned, eligible companies are those investing in developing new products or processes or enhancing existing ones. Basically, those companies who are driving our industries forward with their innovative ideas, both who have been around for years and brand new start-ups.
Has your business recently done, or is it currently doing any of the below?
In the past couple of years, there has been a significant spike in the popularity of elimination diets like dairy or gluten free, as well as more conscious purchasing and eating. Superfoods have leapt onto the market in various forms, as well as an even greater focus on protein fuelled foods. These changes among many others have triggered a lot of research and development to meet the changing requirements of the industry and take advantages of gaps in the market. Either from existing companies or by start-up businesses.
What’s in it for the Government, you ask?
Of course, Research and Development Tax Credits benefit the government, because they were created by the government to incentivise innovation within the UK economy. This means that the UK economy will be stronger and more internationally competitive if it's built on high skill, high technology jobs. This is what the government wants.
The only way to gain is to make a claim.
The only way to find out if you are eligible for this tax relief is by making a claim. You can either do this yourself or through a company specialising in R&D tax.
Lumo are one of these companies, specialists who will assess and put forward your claim on your behalf. Their expertise and experience means that all of the claims they submit are efficient and accurate, and they can help businesses understand and capitalise on R&D tax credits. Lumo's simple and stress-free process is tried and tested, and in as little as six weeks from starting the claim, you could be receiving the money in the bank. Each claim must be explained and presented in the right way to ensure there are no enquiries or investigations from the tax man.
With Lumo's average amount claimed on behalf of clients hitting a whopping £35,000, it is definitely worth getting in touch to discuss if your business is eligible to make a claim. Click here to contact Lumo today to get the ball rolling. Alternatively, here is a simple video on how to make a successful R&D tax claim.
Please click here for a free food and drink industry specific guide to R&D Tax Credits.