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Datafox partners with lawyers, providing a tax service for innovative UK businesses. We would like the opportunity to work with you and spread the word into your businesses network.
The Government Research and Development tax credit scheme is the single largest support for UK business, designed to encourage innovation and global competitiveness by allowing companies to reclaim some of the money invested in qualifying R&D development. The main criteria are determining whether an innovative company is seeking an advance in knowledge or improving a product or service, and resolving uncertainties in the process.
Our Introducers Agreement ensures our partners receive possibly the largest reward for referring R&D claims in the marketplace. The R&D tax credit can equate to up to 33p for every £1 spent on qualifying costs. This means If a UK Ltd company spends £150,000 on qualifying R&D, they could receive up to £50,000 as cash back. As an Introducer, you would be paid a percentage of the amount recovered, for simply introducing contacts of people you know in to us.
Employee costs that qualify for R&D tax relief are eligible as part of your claim. This relates to employing staff directly who are actively engaged in carrying out R&D itself. The staff must be employed under a contract of employment directly with your company .
They shouldn’t be consultants, agency workers, or staff/directors whose contracts of employment are with other companies. However, these others may qualify under either the rules for staff providers or subcontractors.
Staff provider costs that qualify for R&D tax relief are eligible as part of your claim. This is for companies paying a staff provider for staff provided to the company who are directly and actively engaged in carrying out R&D.
The staff provider needs to contract with the individual whose services they supply – not through another person.
Materials costs that qualify for R&D tax relief are eligible as part of your claim. This relates to consumable or transformable materials used directly in carrying out R&D. These are actual physical materials that are consumed in the R&D, and not things like telecommunication or data costs.
Payments to clinical trials volunteers
Clinical trial costs that qualify for R&D tax relief are eligible as part of your claim. The cost of relevant payments to subjects of clinical trials may qualify as part of any claim as part of the R&D process.
Power, water and fuel costs that qualify for R&D tax relief are eligible as part of your claim. Power, water, fuel used directly in carrying out R&D qualifies, but not things like telecommunication costs and data costs.
Computer software costs that qualify for R&D tax relief are eligible as part of your claim. Computer software that is included in the claim must be used directly in the R&D work.
Most companies will make improvements and tweaks to out-of-the-box software, or build their own from scratch, and this will qualify for R&D tax credits.
Subcontracted R&D expenditure
If your company or organisation is claiming tax relief under the SME Scheme then you may be able to claim back 65% of what you spend on certain R&D activities carried out for you by a subcontractor.
But if the subcontractor is connected to your company, or you have jointly elected for connected parties treatment, special rules apply.
Although R&D tax relief is only available for ‘revenue expenditure’ – generally day-to-day running costs, rather than capital expenditure – if you’re involved in R&D and you spend money on capital assets, you may be able to claim R&D capital allowances.
Ready to apply?
If you’re ready to apply for your R&D tax refund, please call us on the freephone number below or use this contact form and one of our helpful team will be in touch to help.
By completing the above contact form you consent that Datafox can contact you with regard to an R&D Tax Credits claim and use your details during any future claims.
Stuff you need to know
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Mini Case Study:
A brewing company that brews beer & operates some pubs on the south coast of England. The claim processed by the expert Datafox team relates to challenges to meet two independent issues regarding regulatory compliance: in the first instance, the brewer was required to invent a custom solution to the discharge of effluent into the sewer system after an issue was raised by the local water company. In the second instance, the brewer was required to design & install a bespoke extraction & air filtration system into the kitchens of one of their pubs. To meet the former requirement, a number of off-the-shelf solutions were tried but found to be wanting. In the end, the brewer had to make modifications to an Oil Tank system to allow capacity for effluent to be held during periods of excessive flow so that filtration systems could cope. To meet the air filtration requirement, the brewer had to work closely with subcontractors to design a system that would fit into an old building, and that would satisfy local authority & DEFRA regulations.
A successful claim was made with the brewer receiving a substantial cash back payment from HMRC with eight weeks.