R&D
SECTION
DR. ECE AKSER ON HOW TO MAXIMISE BENEFITS OF R&D INCENTIVES
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ith the turmoil and uncertainties facing the UK, never has cash flow become more important for a company. None of us can completely and accurately predict what’s coming around the corner or how the UK economy will be affected. With this in mind, it makes sense to take advantage of the incentives that are available; especially those available (and encouraged by Her Majesty’s Revenue & Customs) to any company subject to UK corporation tax. One of those incentives is Research and Development (“R&D”) Incentives. R&D sounds really complex for most businesses and as a result can often be overlooked, however it isn’t as complicated as many think. R&D Incentives do not only relate to the groundbreaking developments that are performed by scientists and engineers – they are also available for many businesses that are developing new products or manufacturing processes or even improving existing ones. R&D Incentives is there to reward companies for doing what they do best – running their business!
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I speak to so many businesses across a wide range of sectors and backgrounds, including those that would traditionally be seen to be undertaking R&D, that believe they do not qualify for relief as they feel they are simply “doing their day job”. During my time as an R&D practitioner, I have helped companies ranging from pharmaceutical, engineering, manufacturing to construction, software and technology. So, ask yourself, are you working on: New products and/or making improvements to existing products e.g. different materials/better performance? Making improvements to manufacturing process e.g. increased efficiency/yield/recyclability, reduced wastage? Undertaking software development e.g. to increase functionality/speed, achieve system integration, reduce downtime.
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“We’re already claiming” But are you claiming everything you are entitled to? Almost every business is probably doing some sort of activity that meets the criteria for claiming the incentives. Sadly, a lot of these businesses are missing out, either in full or in part, by not including everything they can and with up to 33.35% cashback available, that’s criminal!
Also, you might not be calling it “R&D” and instead might be calling it process engineering, applications engineering, value engineering, light weighting, miniaturisation, environmental or legislative requirement changes. In reality, the motivation for the work is not relevant and nor does it have to be identified as R&D. If you are undertaking any of the activities or even something similar, then the chances are you are undertaking R&D activities that may allow you to access R&D Incentives.
“We’re just doing our day job; we couldn’t possibly qualify” Before practising as an R&D advisor, I trained as an Engineer and worked in industry as a Senior Scientist. Looking back, such a large majority of what I did on a day to day basis would have qualified, but I assumed that R&D incentives were for companies that undertook blue-sky research. However, R&D Incentives can be applied to any business that designs or makes something!
Choosing the right specialist to help you I have often heard “advisors have come and talked to us about R&D, claiming to be ‘experts’ but this is the first time we’ve ‘got it’ and can see why we might have something to claim”. This is why it is so important to choose the right advisor, with the right experience, as articulating what “R&D” means within the context of your sector and your business, can be challenging.
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