Understanding HMRC R&D Tax Credits
By and large, this post covers as much as can be on the innovation, research and development grants. Read on and learn on the HMRC R&D tax credits.
By and large, the R&D tax credits are largely a corporation tax relief programs that help a long way in reducing your business’ tax bill. If at all you are a small or medium size business, you will have the alternative of going for the tax credits which are often given in the form of cash sums paid by the HMRC. There are some basic qualifications that one needs to qualify for R&D tax relief. First and foremost, your firm must be liable for corporation tax. The other qualification that has to be met would be such as the fact that the project that you will have undertaken should be one that actually qualifies for the R&D tax relief.
Moving on, the other issue that needs to be well understood is what kinds of research and development projects would actually be considered to be qualifying for R&D tax credits for tax purposes. Essentially for your project to qualify for these tax credits, they ought to have at the very least met and satisfied the somewhat detailed HMRC criteria. Generally speaking, a project would be considered to qualify for the R&D tax credits if at all they happen to be advancing science and technology. The project needs to be such that relates to your company’s intended or existing trade. As for the small and medium scale businesses that want to claim for the tax credits, the R&D tax credits, should be such that must be owning intellectual property that may finally come out of the particular project undertaken.
As for who qualifies, these research and development tax credits can actually be claimed by both the SMEs and the larger companies. The one must factor is that your firm should be liable to the payment of corporation tax.
In as much as the qualification for the credits may sound so simple, the reality is that there are lots of strict rules that will count for what qualifies as expenditure from a taxation perspective. Therefore you see the fact that it wouldn’t be so advisable for you to assume that all items of your R&D expenditure would be qualifying for R&D tax credits. From this, we see the fact that it would be so important and advisable for you to contact a HMRC R&D tax experts and or check the R&D tax relief rules here so as to source for the guidance required for you to make such a successful application for these tax relief and credit programs.
All in all, it can be well said that the rules and all that goes into R&D tax relief and credits can be quite complex and overwhelming and as a general tip to get around them, get in touch with the experts.