R&D tax credits reward UK companies for investing in innovation. Many eligible businesses don't claim this valuable relief.
What Are R&D Tax Credits?
Government incentive to encourage innovation. Provides:
- Corporation tax reductions
- Cash payments for loss-making companies
- Reinvestment opportunities
Who Can Claim?
R&D isn't just for laboratories. You may qualify if you:
- Are a UK limited company
- Undertook work to achieve a scientific or technological advance
- Resolved technical uncertainties
Common industries: Software, manufacturing, engineering, construction, food production, pharmaceuticals, agriculture.
What Qualifies?
Qualifying activities:
- Developing new products or processes
- Creating prototypes
- Overcoming technical challenges
- Improving efficiency through innovation
Doesn't qualify: Arts/humanities work, routine maintenance, market research, admin activities.
Claiming R&D Relief
HMRC operates different schemes depending on company size and circumstances. Current rates, schemes, and detailed guidance available at HMRC R&D Tax Relief guidance.
Claiming costs include:
- Staff salaries and related costs
- Subcontractor payments
- Consumable materials
- Software and utilities
The Claims Process
- Identify qualifying R&D projects
- Document technical challenges and solutions
- Calculate qualifying expenditure
- Prepare technical report
- Submit with corporation tax return
Claims must be made within two years of accounting period end.
Common Mistakes
- Assuming you don't qualify
- Poor documentation
- Missing eligible costs
- Missing deadlines
How We Can Help
Optima Accountancy prepares successful R&D claims:
- Eligibility assessment
- Project identification
- Technical report preparation
- HMRC submission and enquiry support
Contact us for a free R&D assessment.