West Midlands businesses need to move quickly to ensure they make the most of the enhanced Research and Development (R&D) tax credits, according to accountants Mazars in Birmingham.
Changes have been announced in the Budget to R&D tax relief- a valuable tax subsidy which aims to benefit the economy by encouraging increased innovation and productivity.
Peter Jelfs, a member of the specialist R&D team at Mazars, said: “The changes in this Budget further improve the incentives for small companies and start-ups to invest in R&D from April 1.”
“The relief for loss-making companies is vital for start ups as it can provide a cash payment from HMRC now equal to almost one third of the R&D spend, up from one quarter.
“While the Government talks about the relief supporting small companies and start ups, the scheme is available to companies with fewer than 500 employees and either an annual turnover not exceeding 100 million euros or a balance sheet not exceeding 68 million euros – which takes in the vast majority of UK businesses.”
R&D relief gives an additional corporation tax deduction for expenditure incurred on projects that seek to achieve an advance in science or technology but again, the relief is wider than you might expect.
Mr Jelfs said: “The relief can apply not only to high tech companies, but to any company developing a new product or process which involves technology of any sort.”
More than 10,000 SMEs claim R&D tax relief each year. Peter Jelfs and the Mazars team have assisted many companies in the West Midlands to make the most of the opportunity and are happy to have a free exploratory discussion with anyone who wants to find out if they can make a claim.
“This kind of help can be crucial at a critical time in the early lifecycle of an innovative business, and it is important that you take advice on how and when to claim as the process is complex.
“It is vital that your submission is right first time to help maximise cashflow and help you take your project forward as early as possible,” Mr Jelfs commented.