Member Article

TAX EXPERTS REACH £15 MILLION IN R&D TAX RELIEF

Manchester business advisors, Champion Accountants, has reached a significant milestone after helping its clients claim £15million in Research and Development (R&D) tax relief.

This figure represents a 100 per cent success rate, with Champion Accountants successful on every R&D claim that it’s made so far on behalf of a client.

The money claimed as part of the Government’s R&D tax credit scheme is helping businesses to grow and innovate further by delivering huge tax savings and potential cashback from HMRC.

One local business benefiting from Champion’s R&D services is Belmont Packaging in Greater Manchester. The manufacturer develops quality printed, flexographic and corrugated cardboard packaging solutions from its manufacturing facility in Wigan, for clients including Hallmark, Soft & Gentle and New Covent Garden Soup Co.

Investing in projects to develop and boost cardboard strength, as well as effective planning and strategy implementation to become the UK’s first ‘green-focused’ independent packager, saw the company spend £80,000 on R&D activities, with Champion securing a refund of more than £20,000 for Belmont Packaging.

Kate Hulley, owner manager at Belmont Packaging, said: “You wouldn’t necessarily link cardboard boxes and R&D, yet so much of what we do is bespoke development for our clients.

“Champion was brilliant throughout the entire process and able to extract all the information from me and ensure our claim included every possible investment, even down to the energy-efficient lighting that we use!

“We’ll always need R&D within our business and the money we’ve saved will help with cash flow and fund future investment.”

Despite the growing demand for Champion’s R&D services, many potential claimants, particularly SMEs, are losing out by overlooking R&D. Recent figures from HMRC shows that only 17,135 SMEs claimed R&D relief in 2016 – a minute number when the UK is home to 5.4 million small and medium businesses.

The type of activity that qualifies is wide-ranging, from solving customer problems, development of new products to adapting internal processes, with many businesses unknowingly performing R&D tasks on a daily basis.

R&D tax relief enables businesses to claim £46 for every £100 spent on qualifying costs, including wages, materials, overheads and software, as well as the ability to claim cash back from HMRC. Any loss-making SMEs that are yet to make a profit can also claim £33 for every £100 invested in R&D.

First time claims can also include R&D spends over the last two financial years. For example, a company with an accounting year ending on 31 December 2015 has until 31 December 2017 to submit a claim.

David Herd, R&D tax advisor at Champion Accountants, added: “There are plenty of myths out there about R&D tax credits, yet it’s broader than so many realise. Sectors like food and beverages and manufacturing, for example, are actually some of the biggest investors in R&D because they need cutting-edge technology and processes.

“Clients often say it’s too good to be true and it will take a lot of time and resource to put in a claim, which again, isn’t correct. We’ve been advising businesses for a number of years and understand the intricacies of R&D, meaning that we can often decide in less than 15 minutes whether a claim is worth progressing.

“My advice to every business is to approach R&D with an open mind. All it takes is a quick call that could potentially lead to thousands in savings and play a big part in boosting your bottom line.”

This was posted in Bdaily's Members' News section by Champion Accountants .