Are You Overpaying For R&D Tax Credit Specialists?
Date: 17th July 2012
How Much Did You Pay for Help With Your R&D Tax Credit Claim?
If you are already claiming R&D Tax Credits, you may be paying far too much in fees to one of the R&D Tax Credit specialist consultancies.
There is very seldom the need to pay more than 18% of the tax recovered and there is no need to be tied to one consultancy, unless you feel they are offering exceptional value.
Usually the critical factor for a small business is understanding the scope of what can be claimed in terms of eligible projects and then writing a technical justification to support their claim for R&D Tax Credits.
R&D can include advances in science and technology to do things like…
- Create a new product
- Develop a new service
- Design a new business process such as to improve organisational efficiency
And therefore can include:
- Adapting and developing existing software to create innovative new ways of doing things
- Building complex websites or web based applications
- Integrating different technology platforms or devices involving complex systems integration
- Creating innovative new software applications involving technology development
- Designing or redesigning products or elements of a product – involving the innovative use of science or technology.
This could be a new handle or a better lock or more efficient cleaning process so long as science or technology is used in an innovate way. It can also include things like using science or technology in new and innovative ways to develop new ways to make and bake better pies or bread.
If you seek help and advice from a specialist you are likely to increase the value of your claim as evidence seems to suggest that many companies under-claim or worse still don’t claim at all because they have difficulty interpreting and applying the guidelines.
The technical justification needs to identify what projects come within the scope of R&D for Tax Credit purposes and explain in plain English why those projects fit into the guidelines for eligible projects.
In my experience there is no need for the R&D Tax Credit adviser to take on the role of submitting the Corporation Tax Computations which is what some specialist consultancies want to do. We believe a better approach is for the R&D adviser to work with your existing accountants to support them and your finance manager in identify eligible spend categories and in understanding what spend qualifies.
If you are paying 20% or more we can help to reduce your claim costs and if you think you may have overpaid we would like to hear from you.