Unfortunately, no magic bullets exist to get companies out of the current crisis but here are few suggestions around our specialisation & cashflow which may help some.
If you have not claimed previously you really should think about making a claim. Remember claims are not just about doing R&D now or even recently. You can claim within two years of the end of any accounting period. That period is most likely a year long, so you can claim for work you did about three years ago. Get in touch for a free assessment. Now is not the time to miss out, be smart about cashflow.
If you have finished accounting periods and are due R&D claim cash from the cashflow perspective, you should claim as soon as possible. It is worth thinking about accounts preparation and R&D claim preparation before your year end. A lot of work can be done which means a quicker transition to filing the tax return with an R&D claim when the accounting period ends. This is the smart approach.
If you previously made an R&D Tax claim and made a decision not to take a payable R&D Tax Credit; By not surrendering losses for 14.5% of the surrender-able loss but circumstances have changed due to the crisis. Then you can alter that decision and choose to take the cash as long as you are within the amendment window of two years from the accounting period end. Equally, if you think you are probably ok now but want to build a cash pile now to be safe you can choose to take an R&D Tax Credit now, and get cash, but you can reverse that at a later date. So long as that is in the two-year tax return amendment window. This is quite involved blog content, but we are in a period where smart cashflow decisions are crucial. Just talk to us if you want to discuss the options.
If you have been claiming R&D Tax Credits and money is tight. Think about shortening your current accounting period end and claiming as soon as you can get your accounts and R&D claim ready. You can shorten your accounting period as often as you like. So, for example, suppose you have a September 2020 year end and always get a decent sized R&D Tax Credit. Shorten your year end to April 2020. Work fast with hard working folk like us on the claim and potentially get your R&D Tax Credit payment by mid to late June versus maybe November. Nothing to stop you shortening again to September or earlier and bringing more cash in.
Remember you must be a going concern to make an SME R&D Tax Credit claim. The idea above is a very smart play bringing the cash flow forward in tough times.
The only downside is bringing extra accountancy fees forward. But these should not be excessive. If they are, there has never been a better time to negotiate any commercial terms, including with your R&D Tax Consultancy. We have never believed 40%, 33%, 30%, 25% fees are fair. In this environment they look exorbitant. Honestly, it is time for high fees to go. Another smart play. Talk to us about fees and we will find a fee structure that is fair on you and relevant to your circumstances. A low fee makes a big difference to the impact of a claim on your company.
If you are a recent start up. We remain the only major UK R&D tax consultancy to offer free no catch R&D claims covering the first-year trading. Talk to us about Giving Back.
UK business needs to fight back, and we are here to help.