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Even though you already claim R&D Tax Credits, there’s every possibility your company could be sat on ‘secret’ R&D.
But what do we mean by ‘secret’ R&D?
Well, we often come across clients that have developed or built a product, process or service specifically for themselves without recognising that what they are doing is research and development.
They are so focused on just ‘doing’ the work they do, they don’t recognise the steps they are taking.
It’s only when you start thinking in a certain way that you begin to recognise that you are sat on products, service and processes that you could claim R&D Tax Relief for.
With that in mind, we want to share some examples, to give you an idea of the types of activity and situations in which secret R&D occurs.
Secret R&D can manifest in many different ways, through things like:
Here’s five real life examples of businesses that had been sat on secret R&D ….
Business: SAAS Technology solutions
Secret R&D: Business as Usual
R&D Tax Refund: £7.5K
Working with clients to deliver bespoke technology business solutions for a wide range of industries and business scenarios, this company delivers R&D qualifying projects pretty much every day.
The business was so involved in the day-to-day, they didn’t recognise that they were delivering research and development, daily.
The company had also invested significant resource into the development of their own technology solution, just seeing it as an internal project needed to improve their efficiency.
Working with a client they recently developed one of the UK’s most advanced smart metering platforms leading to just over £7.5K of R&D tax credits.
Secret R&D: Resolving Inefficiency
R&D Tax Refund: £6K
An ecommerce business specialising in sports accessories, developed a specialist shipping integration software to improve inefficiencies in their business processes.
Working with a subcontractor, they modified a program to make it more efficient for use within their business.
Significant improvements were made to the software program to integrate the software into their systems, and the internal R&D project generated a claim worth £6k over a two year period.
Although the business set out to resolve inefficiencies in their business process, they were too involved in the project to recognise their own work to be innovative.
Business: Scaffolding contractors
Secret R&D: Save Time & Money
R&D Tax Refund: £22K
These guys are experts in scaffolding, specialising in the provision of scaffolding installations to a wide range of industries.
They had invested in the development of a free-standing scaffolding structure to be used for internal scaffolding, primarily to save their time and cost when setting up jobs.
The company was completely unaware that what they had set out to do was an R&D project.
They just wanted to save themselves time and money!
However, in the process they developed a new innovative scaffolding product applicable industry wide and acquired a corporation tax repayment of over £22K for a two year period.
Business: Gastropub & Hotel
Secret R&D: Improve customer experience
R&D Tax Refund: £7K
A Gastropub and Hotel based in the North of England, wanted to provide a menu that catered for all tastes and needs, as they wanted everyone to find something really good on the menu.
They knew it didn’t make economic sense to have a dozen different menus, so they worked on a new menu to cater for all dietary requirements.
The gastropub developed an innovative menu that could be produced to cater for vegan and gluten free diets, without compromising on the customer experience.
The owner was convinced there wouldn’t be a claim because it’s just ‘what they do’ but when he reflected on all the hard work that goes into crafting their menus he was able to see the numerous research and development steps in their work.
This work realised an R&D Tax claim of £7k for the gastropub.
Business: Fashion & Apparel
Secret R&D: Sales tool
R&D Tax Refund: £15K
A women’s clothing manufacturer and retailer, developed a unique sports clothing range for pregnant women which they understood would qualify for an R&D claim.
However, alongside this they delivered a complex website project which included the development of a global directory of maternity fitness instructors.
Developed as a sales tool, the business was completely unaware that they had built something completely new and innovative.
Altogether the R&D projects equalled a total benefit of just over £15K.
Ensuring you identify all the R&D in your business requires a mindset change, and cultural shift to make it work business wide. You have to change the way you think about what you are doing day-to-day. Encourage your employees to constantly challenge the way they – and others – do things, to make suggestions for improvements and bring forward new ideas.
You could be sat on secret R&D gold.
If you think you might be eligible for R&D Tax Relief, and you’d like to find out more about how we can help you make your R&D claim, please get in touch.
Posted 1 day ago
As a business owner, I want to build a really good future for myself and my partner. That involves making sure I’m aware of all the right things so we can achieve what we set out to. One of the ways to do this is through a Tax Diagnostic.