More than £5.5m in tax savings delivered to UK businesses
Since lockdown, YesTax has delivered over £5.5m in tax savings and repayments to its clients. It’s often a surprise for companies across many sectors that much of the work they undertake can qualify for R&D tax relief.
R&D tax relief is available to companies which are making advancements in their respective fields. These advancements need not be brand new technology – creating new, improved or bespoke products, developing new processes or duplicating existing products and processes in an appreciably improved way can often qualify for the relief. Many claims are still being missed because companies do not appreciate the scope of the R&D definition for tax relief purposes.
YesTax works closely with HMRC and in recent weeks we have given updates regarding the impact on R&D tax relief of the various COVID-19 support mechanisms. The key points to note are:
- CBILS, CLBILS and Bounce Back Loans are all notifiable state aids but will only impact R&D claims if the loans are specifically for R&D expenditure. We anticipate few cases of this kind. As a result these loans are unlikely to push an SME claim into the less generous RDEC scheme.
- Where Ministers have agreed that tax can be deferred for a specific regime to support businesses in the COVID-19 period, i.e. the ITSA payment on account and VAT quarterly payment deferrals, RDEC or payable tax credits will not be set against any of those amounts before the revised due date. This is welcome news to the many businesses which have deferred their VAT payments in recent weeks.
- Where tax has been deferred as part of a Time to Pay (TTP) arrangement, HMRC will follow existing policy and set any R&D tax credit off against any TTP liability, not just the amount owing at the point in time the credit is paid. This would include informal deferrals offered in advance of TTP arrangements being put in place
R&D is an invaluable tax saving opportunity, particularly at this business-critical time. Don’t hesitate to contact us to discuss your claim.
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