What are the current R&D Tax Credit schemes and what are the tax advantages?

There are currently three schemes offered to companies for R&D tax relief: (1) the Small Medium Enterprise (“SME”) Scheme, (2) the Large Company Scheme and (3) the Research & Development Expenditure Credit (“RDEC”). To be qualified for the SME Scheme, a company must have less than 500 employees (and have an annual turnover not exceeding 100 million Euros & a balance sheet not exceeding 86 million Euros). Companies are qualified for the Large Company Scheme or the RDEC if they do not qualify for SME Scheme. 

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The tax advantages include the following:
  • The SME Scheme allows for 230% R&D tax relief, for the financial year 2016/17, on qualified R&D spending up to 7.5 million Euros;

  • For example, for every £1 spent on qualified R&D by an SME, an additional £1.30 is to be discounted from taxable income on top of the original £1 spent;

  • The Large Company Scheme allows for a 125% deduction for expenditure incurred up to 31/3/08 and a 130% R&D tax relief thereafter on qualified R&D spending;

  • For example, for every £1 spent on qualified R&D by an SME, an additional £0.30 is to be discounted from taxable income on top of the original £1 spent;

  • RDEC was introduced for expenditure on or after 1st April 2013 which will coexist until 31/3/16, and subsequently replace the Large Company Scheme; and 

  • The RDEC works on the same premise as the Large Company Scheme, but provides for a standardised credit of 9.1% of qualifying expenditure incurred on or after 1st April 2013.

How can Sapphire help you?

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We will explain the cash your business can potentially claim.

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We will assist with the HMRC application.

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We will obtain your R&D Tax Credits.

Sapphire will clearly explain the potential cash you could claim.

Obtaining HMRC advance assurance can be time consuming. We are here to help. 

Although R&D tax credits have been around for quite some time, many entrepreneurs are not aware that they can significantly benefit from them. It is important for entrepreneurs of start up companies to take advantage of any governmental incentivisation and support that may be available to them as this support directly impacts cash flows as well as shows investors that the business is being operated in an efficient and effective manner. HMRC offer advance assurance to companies seeking to claim R&D credits. This assists companies with accurately estimating and budgeting for the benefits for three years. Although it is not necessary to obtain this in order to put in a R&D tax credit claim, it will get the credit processed faster, with less hassle. This is where we can help you. We are here to ensure that your company is optimising all the available support and claiming back the cash it is potential due.  And, most importantly, we take the hassle of preparing and making the claim off your hands. 

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Our services include the following:
  • We check whether you qualify for R&D Tax Credits.

  • We estimate the potential credit you will receive.

  • We prepare the HMRC documents.

  • We make the HMRC application.

  • We answer all the HMRC questions.

  • We work with HMRC to get issues resolved.

  • We obtain your R&D Tax Credit advance assurance.

Sapphire will make all the HMRC claims.

We have assisted numerous clients with their R&D Tax Credit claims. 

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Our services include the following:
  • Assess if your business qualifies for R&D Tax Credits.

  • Selection of the scheme type to apply for.

  • We prepare the advance assurance documents.

  • We make the HMRC application.

Sapphire will obtain your R&D Tax Credits.

We can assist your company to obtain the R&D Tax Credit.

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Our services include the following:
  • We can help you estimate the potential benefit.
  • Assisting in making the claim on your income tax return.
  • We calculate the potential credit for your business.
  • We assist with the claim on the income tax return.
Sapphire Capital Partners Team

 

CUSTOMER SUPPORT

We are more than just an R&D tax consultancy service.

You don't have to go it alone. The team at Sapphire are here to answer your questions, help you get to grips with what is required for a successful R&D Tax Credit application and answer any follow-up questions HMRC might have. All that - plus our dedicated help, blog resources and templates - means you will never feel you do not have enough support.

Watch our R&D Tax Credit introduction video.

 

Download our FREE eBook guide to R&D Tax Credits.

Our FREE eBook guide will help you understand R&D Tax Credits.

Your eBook guide will reveal:

  • Which companies qualify for R&D.
  • Explanation of the tax benefits.
  • How to get HMRC advance assurance.
  • The steps involved.

Our eBook will save you valuable time and expense in your quest to understand R&D Tax Credits and get your start up company approved by HMRC.

Fill in the form to request the eBook.

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