Tax relief to boost research and development
More businesses should take up the growing tax incentives available for research and development, according to a local accountant.
According to George Hardley, a tax specialist at Waltons Clark Whitehill, changes to levels of tax relief means that there has never been a better time for innovative companies to be active in the UK.
My Hardley commented: “HMRC has put a real focus now on encouraging companies to make claims for tax relief where they undertake research and development.
“In the past, the Revenue has been seen as solely trying to police claims, but with the increase in tax relief and also this more proactive approach, there is a real opportunity for innovative companies to increase their R&D activities and gain access to the very valuable tax reliefs.”
Her Majesty’s Revenue and Customs have changed the system, so that for every £100 pounds spent on research and development, businesses are entitled to £200 - an increase of £125 on the previous amount.
This will be increased again in 2012, and the relief will cover £225 for every £100 of research spending.
He added: “However, there are some technicalities as to the types of R&D which qualify, though it should not simply be thought of as something done by a ‘man in white coat in a lab’.
‘Brown coat development’ may also qualify e.g. engineering, design and similar activities, including development of new products and services as well as improved production processes.
“It is worth any business checking with a qualified tax professional before proceeding with claims and making changes to business plans to capitalise upon this positive approach from HMRC.”
This was posted in Bdaily's Members' News section by Ruth Mitchell .
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