Most companies want to improve their bottom line but have you asked yourself what:
- a reduced tax bill would mean to your bottom line?
- 2 reduced tax bills would mean to your bottom line?
- 2 reduced tax bills and a tax rebate would mean to your bottom line?
The Government are investing money into innovation in the UK, encouraging, and indeed rewarding, those companies that work on innovative projects.
- Receiving more than 25,000 claims in a single year, the UK Government helps support more than £3.3 billion of Research & Development
- As part of the tax reforms of 2008, the Government aimed to promote investment & growth, which included Capital Allowances
- In 2014/15, the UK Government supported patent relief claims to the value of £651.9 billion with 54.2% coming from manufacturing companies. Manufacturers also claimed the highest value of claims, at 50.7% of the total
But many companies don’t know they qualify and are missing out on huge growth potential!
Check your eligibility
You could benefit from government financial support on any or all of the following:
- R&D Tax Relief
- Patent Box
- Capital Allowance
Research & Development (R&D) Tax Relief
This involves claiming tax relief on R&D activity – but don’t be fooled into thinking this is just for companies that develop new products.
You could be eligible if you design or make new products, prototypes or perform testing. It also applies to companies that find ways (whether they are successful or not) to develop processes or overcome obstacles or uncertainty, for example developing software or IT solutions.
It even applies to money invested in failed projects or products that never made it to market or organisations who employ staff with a technical or scientific background.
And if you are thinking it will take more time, effort and money to apply than you could save in return, then think again. A specialist provider can do all the hard work for you and simply take a percentage of the money saved. If you don’t save, they won’t charge – it’s a win/win!
Patent Box Tax Relief
If you cultivate, maintain and exploit patents in the UK then you could be rewarded by HMRC through a reduction in the taxable profits from creations that are patented even if the part that is patented is minimal.
Reduce the stress of applying by using a specialist advisor. They will assess where patent applications can be made in order to benefit from the associated tax saving, be it your IP, products or processes. They will take all the nitty gritty work away from you as they know what they are looking for and their fees will be well justified against the savings achieved, otherwise they will not charge you. They will also know how to manage HMRC, liaising with them to deal with any queries. A good advisor will also be able to prolong the length of the return, maximising your claim.
To encourage capital investment in equipment and property the Government outlines tax incentives in the Capital Allowances Act. This legislation has evolved over time, post war saw the introduction of Mills and Factories Allowances giving relief on this investment. Today we see incentives to encourage investment in Green technologies that qualify for Enhanced Capital Allowances (ECAs)
When purchasing or refurbishing property a specialist Capital Allowances advisor will be able to unlock the tax relief you are entitled to on the property acquisition sum or construction expenditure.
A good advisor will be able to assist you in submitting a claim – look for someone who understands property and tax. A specialist will be both a chartered quantity surveyor and a qualified tax advisor . Their specialist knowledge will ensure that your tax relief is maximised and your claim is successful.
Any successful claim should reduce your tax straight away and for the duration you own your property. It should also take into account historic and future/planned property purchases.
The Annual Investment Allowance (AIA) allows for of 100% on the first £200k of qualifying expenditure to be deducted against taxable profits. You only have 2 years to make this claim, otherwise the relief can drop to just 8% per year of the capital investment made. Seek early advice to ensure that no opportunities are missed and your cash flow is maximised.
Capital Allowances apply to both income and corporation tax payers and apply whenever you have spent money on commercial property in the UK. There is no time limit for claiming on property you already hold.
What would 2 reduced tax bills and a tax rebate mean to your bottom line?
If you are still unsure whether your business is eligible for any of these schemes, don’t worry! We can do a quick, free assessment for you! It won’t cost you anything other than a little of your time and a coffee. A small investment for the potential tax savings of £1000’s!