HMRC released data indicates that tax credit claims for R&D continues to increase. In 2011-12 the number of claims increased by 8.6% with almost £1.2 billion being claimed that year. An increased awareness about the process and the willingness of companies to employ R&D tax relief specialists has played a very important part in this change. Engaging specialists for this job comes at a heavy price, even though it is a common complaint that these charges are unreasonable. Here are a few reasons to explain why R&D tax credit consultancy charges are so unequal:
- Filing an R&D claim involves a thorough understanding of the industry and the technology related to it: Accountants can help you file the CT600 returns, but he can hardly be expected to understand the technology you have improvised or tried to improvise to be able to file a successful claim. Only a specialist would have the technical knowhow to understand the qualifying terms.
- It takes a lot of work to file a successful R&D Tax Claim: The specialist’s job does not end with identifying the qualifying conditions. He is also responsible for preparing the technical justification documents, calculating the size of the claim after assessing the HMRC criteria for the said industry, following up on the claim with the HMRC, and offering answers to doubts raised by the HMRC auditor. And if a claim is audited, his job is to prepare key officials in answering the auditor’s questions. As much as an accountant is willing to help, he is not qualified to perform these tasks.