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All on R&D Tax Credits

By and large, this post covers as much as can be on the innovation, research and development grants. Read on and learn on the HMRC R&D tax credits.

By and large, the R&D tax credits are largely a corporation tax relief programs that help a long way in reducing your business’ tax bill. For the small and medium size businesses, they have the alternative of going for the tax credits instead which would often come in the form of a cash sum that is paid by the HM Revenue and Customs, HMRC. In order for you to qualify for the R&D tax credits, there are some basic qualifications that one should have met. These are such as the fact that your firm must be liable for the payment of corporation tax. The other qualifying aspect for these would be such as the fact that your project should be one that qualifies for relief.

Moving on, the other issue that needs to be well understood is what kinds of research and development projects would actually be considered to be qualifying for R&D tax credits for tax purposes. Essentially for your project to qualify for these tax credits, they ought to have at the very least met and satisfied the somewhat detailed HMRC criteria. Generally speaking, a project would be considered to qualify for the R&D tax credits if at all they happen to be advancing science and technology. The project needs to be such that relates to your company’s intended or existing trade. And looking at the SME claims for these tax credits, the small and medium size businesses that intend to claim them should be such that actually will or must own intellectual property that arises out of the project.

As for who qualifies, these research and development tax credits can actually be claimed by both the SMEs and the larger companies. The one must factor is that your firm should be liable to the payment of corporation tax.

In as much as the qualification for the credits may sound so simple, the reality is that there are lots of strict rules that will count for what qualifies as expenditure from a taxation perspective. Therefore you see the fact that it wouldn’t be so advisable for you to assume that all items of your R&D expenditure would be qualifying for R&D tax credits. It would as such be advisable for you to ensure that you liaise with an HMRC and R&D tax expert or read the R&D tax relief rules so as to get the guidance on how to make a successful application for these tax credits.

Generally speaking, R&D tax credits can be quite confusing and really complicated for the untrained and for this reason, it would pay for you to think of getting in touch with the pros.

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