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Claiming R&D Tax Credits


You may be aware that the Government are currently encouraging business to invest in Research and Development. There are generous allowances available now and backdated reclaims are being encouraged for the previous two years.

R&D Tax Credits can be a massive help to companies which pay Corporation Tax and undertake qualifying R&D.  The R&D Enhanced Tax Allowance - the amount which a business can claim as a tax deduction is 125 per cent of qualifying expenditure on R&D activities.  This means that the net profit figure for corporation tax purposes can be substantially reduced, with a corresponding improvement in the cash position after tax. 

Where a company is not in profit, a lower amount of tax credit is paid in cash. From 1 April 2014 the rate of R&D payable tax credit for loss making small SMEs will be
increased from 11 per cent to 14.5 per cent. This will increase the rate of the cash credit
payable to SMEs that conduct qualifying R&D activity but do not have corporation tax

From the HMRC perspective, qualifying R&D has the objective of advancing the capability of science or technology to resolve technological uncertainty, allowing the company to innovate and develop new products, services or processes.

Many companies tend to understate the extent of the R&D they carry out and the claim may not reflect the true value of the work. .

We work with SMEs (Small to Medium Enterprises) and your own accountant to recover your R&D Corporation Tax allowance. The process has been made deliberately fast and painless and we take care of the technical justification, processing the application and subsequent liaison with HMRC.

Morgan Potter Consulting Ltd is an Associate of R and D Tax who are members of Intellect representing the UK technology industry.

Please see the Blog section for more information, or call 07870 649207 for an informal discussion about claiming R&D Tax Credits.

© Morgan Potter Consulting Ltd, 2012
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