R&D Tax Credit Opportunities

R&D tax credit opportunities

R&D tax credit opportunities

This is something that we find really interesting, government wants UK companies to innovate their way out of the downturn and are supporting this by providing R&D tax credits as a tax incentive that may reduce your company tax bill.

Your company or organisation can only claim R&D Relief if it is liable for Corporation Tax, and there are two distinct initiatives on offer. These are:

  • The Small or Medium-sized Enterprise (SME) Scheme
  • The Large Company Scheme

HMRC logoR&D for Small to Medium sized businesses (SMEs)

It is important that your business meets the criteria for SME, which as of 1st August 2008 is stated as:

A company or organisation with fewer than 500 employees and either of the following:

  • An annual turnover not exceeding €100 million
  • A balance sheet not exceeding €86 million

If your company belongs to a larger group or enterprise, it may not be considered an SME and subsequently fail these tests.

The Small and Medium sized Enterprise Scheme has higher rates of relief

From 1 April 2011, the tax relief on allowable R&D costs is 200 per cent – that is, for each £100 of qualifying costs, your company or organisation could have the income on which Corporation Tax is paid reduced by an additional £100 on top of the £100 spent. It also includes a payable credit in some circumstances.

Subject to Parliamentary approval, the rate will increase further to 225 per cent from 1 April 2012.

The Large Company Scheme

If your company exceeds the criteria for SME, then a claim is only possible under the Large Company Scheme.

Amount of expenditure for large companies

Tax relief is only available if you spend at a rate of at least £10,000 a year on qualifying R&D costs in an accounting period. The Chancellor announced in his Budget on 31 March 2011 that this limit would be removed for expenditure incurred on or after 1 April 2012. There is no upper limit.

Rate of tax relief

From 1 April 2008, the tax relief on allowable R&D costs is 130 per cent – that is, for each £100 of qualifying costs, your company or organisation could have the income on which Corporation Tax is paid reduced by an additional £30 on top of the £100 spent. If instead there is an allowable trading loss for the period, this can be increased by 30 per cent of the qualifying R&D costs – £30 for each £100 spent. This loss can be carried forwards or back in the normal way.

Which R&D projects might qualify for Relief?

HMRC have clearly defined R&D Relief in relation to a claim. If an R&D project seeks:

 “…to achieve an advance in overall knowledge or capability in a field of science or technology through the resolution of scientific or technological uncertainty…”

The project cannot simply advance the companies own state of knowledge or capability.

Furthermore, for accounting periods ending before 9 December 2009, the project must satisfy both of the following conditions:

  • It must be related to your company or organisation’s trade – either an existing one, or one that you intend to start up based on the results of the R&D
  • If your company or organisation is claiming relief under the SME Scheme, it must own any intellectual property that might arise from the project

How to show the project is R&D within the tax definition

There are guidelines that define all the following terms, and it’s important to understand these concepts before attempting to reach a view on whether your company or organisation has an R&D project for tax purposes.

  • Project
  • Advance in science or technology
  • Science
  • Technology
  • Directly contribute
  • Scientific or technological uncertainty

Costs that qualify for R&D tax credit

Costs will be involved in the delivery of the project and the following qualify for R&D relief:

  • Employee costs – the employment of employees actively involved in carrying out R&D
  • Staff provider – paying a staff provider for staff provided to the company directly engaged in R&D
  • Materials – consumable materials directly involved in carrying out R&D
  • Payments to clinical trials volunteers
  • Utilities – power, water, fuel etc used in carrying out R&D – no phone or data costs can be included
  • Software – applications involved in carrying out R&D
  • Subcontracted R&D expenditure – potential for up to 65% of what is paid in R&D activity that is subcontracted
  • Capital Expenditure – Potential for R&D capital allowances claim on capital assets

For all additional information and some useful calculations, more information is on HMRC: http://www.hmrc.gov.uk/ct/forms-rates/claims/randd.htm

Please get in touch with us for facilitation and recommendations on suitable delivery partners.

 

Keeping ahead of industry developments and updates can seem a hard task, but we try and make it as easy as possible with our marketing news blogs.

Are you Cookie compliant? If not, we’ve got three great solutions.

are you cookie compliant

are you cookie compliant

The EU Cookie Directive came into force in May 2012. But there’s still a large number of websites which are not yet compliant. Is yours one of them?

The Cookie law was brought in to protect the privacy of internet users by informing them of a websites use of cookies.

In order to comply, a website must alert a user to the use of cookies. As well as show which cookies are being used. What they do and allow users to manage them.

You’ll be happy to know that we offer three different solutions; one for webmasters, a non-branded solution and a branded solution. (Did we mention that the non-branded and branded solution come with a nifty certificate?)

Despite some big website’s still being non-compliant the Cookie law is not something to be ignored. As non-compliance can lead to a £500,000 fine from the ICO (Information Commissioner’s Office), which we can both agree is pretty nasty.

Visit our Cookie solution page to see our quick and effective compliant solutions.

If you know anybody with a non-compliant website, help them avoid a fine and share our page.

 

 

If you live in the Burntwood, Lichfield, Cannock or Staffordshire area and require some help or advice with your marketing. Why not see what we can do. Take a look at our case studies. Or call us on 01543 495752 and book a no obligation meeting with us today.

If you want to read more from our website series of blogs, just click here to see what other resources are available.

How to turn cookies off in browser.

how to turn cookies off in browser

how to turn cookies off in browser

On the 25th May 2012, the Cookie Directive comes into force, to give Internet users more privacy.

Cookies are small text files, which websites store on your computer when you first visit them. When you return, they can use the cookies to see if you’ve visited before or if you’ve changed any settings on the website, such as using a larger font.

 

First Party Cookies

This is a cookie which is used by the website you are visiting. For example, if you visit www.domain.com, it will save a cookie on your computer. Only www.domain.com can read this cookie.

 

Third Party Cookies

Third party cookies are cookies which are not set by the website you are visiting. For example, when you visit a website which has advertisement banners, the adverts are set by another website and a third-party cookie is used.

Instead of waiting for the Cookie Directive to come in, you can turn cookies off in your browser.
This article explains how to turn first and third party cookies off in; Google Chrome, Safari, Internet Explorer, Firefox and Opera.

All browsers were the latest and most up to date version at the time of publishing. (24th April 2012)

 

Google Chrome:

  1. 1. Open Google Chrome.
  2. 2. Click on the wrench icon on the upper right hand side of the toolbar.
  3. 3. Select ‘settings’.
  4. 4. Click ‘Under the Hood’ from the panel on the left of the screen.
  5. 5. Select ‘Content settings…’
  6. 6. To block cookies entirely select ‘Block sites from setting any data’.
  7. 7. If you just want to block third party cookies, ads etc, click ‘Block third-party cookies and site data’.

 

Safari:

Safari is kind enough to block third-party and advertisement cookies as a standard, so if that’s all you want to block then you don’t need to do anything.

To remove all other cookies;

  1. 1. Open Safari.
  2. 2. Click the settings icon, which looks like a cog, at the top right hand side of the toolbar.
  3. 3. Click ‘Preferences’, which is near the bottom of the page.
  4. 4. Choose the ‘Privacy’ tab.
  5. 5. Select Block cookies: Always

 

Internet Explorer:

Internet Explorer has various cookie settings; block all cookies, high, medium high, medium, low and accept all cookies. It explains exactly what all of these settings mean, so you can choose the right one for you.

  1. 1. Open Internet Explorer.
  2. 2. Click the settings icon, which looks like a cog, which can be found at the top right hand side of the toolbar.
  3. 3. Click on ‘Internet Options’.
  4. 4. Choose the ‘Privacy’ tab.
  5. 5. Under the heading ‘Settings’ you will see a slider with the settings mentioned above. The block all cookies, select the top setting.

 

Mozilla Firefox:

  1. 1. Open Firefox.
  2. 2. Click on ‘Tools’ at the top of the browser window.
  3. 3. Then select ‘Options’.
  4. 4. Click on the ‘Privacy’ tab.
  5. 5. Next to the words ‘Firefox will’ is a drop down menu, click that and select ‘Use custom settings for history’.
  6. 6. This will load some extra options beneath. To prevent cookies from being used untick the box that says ‘Accept cookies from sites’. If you just want to block third-party cookies untick the box which says ‘Accept third-party cookies’.

 

Opera:

  1. 1. Open Opera.
  2. 2. Click the ‘Opera’ icon at the top left hand side of the browser.
  3. 3. Select ‘Settings’ and then ‘Preferences…’.
  4. 4. Click on the ‘Advanced’ tab and choose ‘Cookies’ from the panel on the left hand side.
  5. 5. To block all cookies, select ‘Never accept cookies’. To block third-party cookies select ‘Accept only cookies from the site I visit’.
  6. 6. Press ‘Ok’.

 

If you live in the Burntwood, Lichfield, Cannock or Staffordshire area and require some help or advice with your marketing, why not see what we can do. Take a look at our case studies, and call us on 01543 495752 and book a no obligation meeting with us today.

If you want to read more from our website series of blogs, just click here to see what other resources are available.