“Aren’t R&D tax credits only for businesses using test tubes and wearing lab coats?”

I have been asked that exact question more times than I care to remember so it’s no surprise that only a small proportion of businesses that can claim tax relief actually submit a claim to HMRC.

The truth is the majority of manufacturing businesses regularly inject some element of research and development into their operations. When you take time to understand a business’ operations and ask the appropriate questions, research and development processes that aren’t immediately apparent can often be discovered.

But R&D (Research and Development) tax relief is clearly not just limited to manufacturing. By taking a genuine interest in how our clients' businesses operate we have uncovered R&D processes in somewhat less than obvious places:

  1. Pig farming - researching new pig genetics and how they work on UK phenotypes
  2. Brewery - the rise in the popularity of micro breweries and new beers means than many of these are involving complex scientific advances
  3. Marketing agency - as the UK economy is digitalised marketing agencies have to be at the forefront on digital technology to take advantage of new opportunities
  4. Logistics - new technologies to more efficiently move products around the country
  5. Telecommunications - advanced telecommunications technology to take advantage of digitalisation
  6. Baby accessories - new designs innovative with advanced technology to ensure better child safety
  7. Horticulture - improved science to produce better natural plants, that grow quicker, look better an live longer

I trust this proves categorically that lab coats and test tubes are not a pre-request for a successful R&D tax credits claim! As advisers we have a genuine interest in our clients' businesses and that’s given us the experience and expertise required to identify R&D processes in even the most unusual places.  The key message is throw away any preconceptions.

If you think you may have grounds to claim R&D tax relief then please contact me today on 01434 375550 or email tony.bullock@armstrongwatson.co.uk.  I can explain the next steps to finding out if you could be using your own research and development efforts to reduce your business’ tax bill.

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