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Understanding HMRC R&D Tax Credits

Read on in this guide and learn as much on the innovation, research and development grants. Learn of the R&D tax credits.

By and large, the R&D tax credits are largely a corporation tax relief programs that help a long way in reducing your business’ tax bill. For the small and medium size businesses, they can opt for the tax credits which are in most cases reimbursements paid out by the HM Revenue and Customs. As a matter of fact, there are some basic qualifications that one ought to have met in order to qualify for the R&D tax credits. One of these would be such as the fact that the firm you run should be one that is liable for the payment of corporation tax. The other qualification that has to be met would be such as the fact that the project that you will have undertaken should be one that actually qualifies for the R&D tax relief.

So what qualifies as R&D for tax purposes? For your project to qualify, it generally has to meet the rather detailed criteria set out by the HMRC. In a general sense, qualifying projects would be such that generally help advance science and technology. The project needs to be such that relates to your company’s intended or existing trade. And looking at the SME claims for these tax credits, the small and medium size businesses that intend to claim them should be such that actually will or must own intellectual property that arises out of the project.

By far and large, all companies that meet such basic criteria can make a claim for the R&D tax credits from the HMRC, both the small and medium businesses and as well the larger corporations. This is all provided that the company is liable to corporation tax.

By and large, even though from appearance it may seem so easy and simple to tell what it is that qualifies for the R&D tax credits, the reality is that the finer details of what qualifies expenditure happen to be telling a lot more of stricter regulations for tax purposes. Thus it would not be as advisable for you to assume that all of your expenditure would qualify for R&D tax credits. From this, we see the fact that it would be so important and advisable for you to contact a HMRC R&D tax experts and or check the R&D tax relief rules here so as to source for the guidance required for you to make such a successful application for these tax relief and credit programs.

All in all, it can be well said that the rules and all that goes into R&D tax relief and credits can be quite complex and overwhelming and as a general tip to get around them, get in touch with the experts.

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