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An innovative electronics manufacturer in Poole has received an impressive £250k as tax relief from the government via the research and development tax credits scheme – all within less than 2 years.

Rob Sowden, innovation tax incentives specialist at Business Cash Enabler writes:

“I visited this company less than two years ago and explained the innovation tax incentives available to the owning director.  They were eligible for research & development (R&D) tax credits, which enables a business to recoup a large proportion of costs incurred for any form of unique innovation that requires overcoming technical or scientific uncertainty.  The qualifying expenditure can generate tax rebates, a cash payment even when the business is loss-making, a deduction to offset tax on account or an enhancement of losses to reduce future tax liability arising.  Whichever way the client receives the credit, it is a bottom-line contribution to the business.

“A trading company in any sector that carries out any form of unique innovation may qualify year-on-year for this cashback from HMRC under this very generous scheme.  A first time claimant company may be able to claim back for the prior two accounting periods, or must have at least their first set of trading accounts.  The £250k this company received was based on two retrospective claim years plus their current year. A business does not have to be profitable to get this cashback, in fact a loss-making company can obtain an enhanced cash payout, up to 33% of qualifying staff costs. Some businesses have previously claimed and received small amounts, maybe £20k or £30k, which is much less than they are entitled to. What catches many businesses out is that they believe this claim opportunity is an accountancy work-stream, whereas it is really about technology.  The service I introduced this client to required a specialist technology analyst to identify all of the qualifying activities permitted within the government’s scheme rules.”

Business Cash Enabler provides a free service to businesses to check eligibility for innovation tax incentives.

Published 08/06/19 by Rob Sowden

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