When is it too late to claim R&D tax credits?

Businesses undertaking research and development projects provide valuable innovations across a range of industries, but many don’t realise they can be reimbursed for their activities. Whether the reason for missing out is a lack of awareness, uncertainty over eligibility, or being perplexed by the complexity of the claims process, not claiming can prove to be the difference between continuing with research or having to abandon the project due to lack of funding.

However, there is good news for companies who have previouslymissed the opportunity to submit an HMRC R and D claim: they can be filed retrospectively.

When you can claim

Businesses that are familiar with making an R&D claim will know that it is typically made alongside the preparation and submission of your Company Tax Return(CT600). A field is provided where companies can supply details of their expenditure in relation to an R&D project, as well as a calculation for the tax relief owed.It’s also advisable to providesupporting documentation to evidence the legitimacy of a claim.

If this part of the form hasbeen overlooked in previous years, however, it is possible for a business to claim retrospectively for up to two years. This means that any backdated claims will be processed in one go, potentially leading to a substantial injection of cash.

Image result for When is it too late to claim R&D tax credits?

Making backdated claims

Due to the intricacies of making an HMRC R and D claim, it’s a good idea to consult a professional when putting together your submission. Experienced R and D tax specialists have in-depth knowledge of the claims process and what documentation needs to be provided, so can assist withthe collation of relevant information, check figures and liaise with HMRC on your behalf.

In making a backdated claim, it’s possible to be reimbursed for up to 26% of the expenditure on qualifying costs for an R&D project. These might include staffing, sub-contracting, consumable materials, software licences, and more, all for a period of two years previous. With the average claim estimated to be in excess of £60,000 per year for applicable costs, your business could recoup a significant sum that enables you to continue innovating.

It’s (almost) never too late to claim

By now you should be aware that, if you have previously missed an opportunity to claim for R&D tax relief, you can make a backdated claim and still benefit from such rewards. While the two-year limit on retrospective claims restricts how much expenditure you can be reimbursed for, there is still a considerable incentive to speak to an R and D tax specialist and take steps to receive the money you’re entitled to.

If you think your business may be eligible to make a backdated claim for R&D tax credits, get in touch with a specialist tax advisor today.

Leave A Comment