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Are you Kene to partner with us for R&D claims?

Are you Kene to partner with us for R&D claims?

Often the image conjured up with the phase “Research and Development” is that of people in white coats playing with bunsen burners.

From HMRC’s perspective however, the definition of R&D is purposefully broad so that it captures innovation in all sectors including those outside the general core sectors of manufacturing, IT and pharmaceuticals. The scope of qualifying R&D relief will now extend to cover cloud and computing data following a consultation launched by the Government in the Spring Budget 2021.

Many business owners do not realise that the work they do solving problems on a day-to-day basis could qualify for R&D tax relief – and that is where specialist help is needed.

HMRC’s definition of an ‘advance’ in science or technology (for R&D tax purposes) incorporates an awareness that existing knowledge and comparable solutions will be able to help business in their development work. It is the efforts (and associated costs) in going beyond this existing baseline level of knowledge and capability in a particular field of science or technology that the R&D claim aims to encapsulate.

Serious R&D claim preparation is therefore a technically demanding process and working with a specialist adviser to compile a claim can give a significant advantage.

Here are two recent examples of successful claims in industry sectors where the directors didn’t initially think they were carrying out R&D.

Demolition company

In a recent case, Kene Partners were able to identify areas of R&D for one of Creaseys' clients operating in the demolition sector. With help from our own team, financial information was gathered, analysed and assessed, allowing Kene to compile a list of potential projects. Identifying key projects using in-depth knowledge of the R&D legislation allowed technical calls to be conducted immediately with our client’s very competent professional team. The company secured a cash refund of around £80,000 through a successful R&D claim.

Recycling company

In the second example, a client in the waste disposal sector worked with Kene to make a successful R&D credit claim of just under £80,000. The project in question involved the refining processes used in the business and how our client was able to ensure their products contained a higher level of organic compounds. The technical team at Kene and the client’s technical expert worked closely, enabling the R&D team to identify whether a valid claim could be made and identify the qualifying R&D costs.

These examples show that by having conversations with Creaseys and Kene, areas which had not previously been considered as qualifying for the purpose of R&D were included in robust claims and provided a welcome cash boost to the businesses.

With their pledges of spending investment, expansions of sectors able to benefit from R&D relief and the promise to reward UK based innovations as a priority over international investors, the Government are obviously keen to encourage and reward innovation and investment in R&D. The latest Budgets and raft of improvements to the scheme should secure its longevity and effectiveness for years to come.

Your company could be missing out on thousands of pounds in R&D tax benefits. Having a team of technical specialists behind you to make a robust claim with very little of your own time required could net you some unexpected cash. Get in touch today and let’s have the conversation to explore whether R&D tax credits are relevant for your business. If you want to find out more, please get in touch with your usual Creaseys contact or call us on 01892 546546.