Presentation on theme: "R&D Tax Credits Business Solutions (Midlands) Ltd Darren Glover."— Presentation transcript:
R&D Tax Credits Business Solutions (Midlands) Ltd Darren Glover
Overview R&D Tax Credits –Background –How to Claim –The Business Solutions way –Case Studies Patent Box –Overview
Background Government attempt to boost UK R&D –Launched in 2001 – over 74,000 claims submitted and over £7Billion of relief claimed Under used – Only 10% of 150,000 eligible companies claiming Companies involved in creating new / improved products or processes Degree of novelty – not necessarily Patentable or ‘blue sky’ in lab coats!
What are R&D Tax Credits What is R&D –Product development not carried out anywhere else –Innovative Process development –Software development What is not R&D –‘Bespoke product’ not necessarily R&D – ‘Design’ in it’s own right
Example Information Employment Costs Materials, including prototypes Sub Contract Costs Utilities CT600’s & Tax Computations Technical Report
Research & Development What’s the “Technical Uncertainty” of each project? - can it be solved by a ‘competent professional’? HMRC interested in Project Innovation and commercial benefit – leads to more tax!
Claim Information Financial Spreadsheets Technical Report Large (500 emp, 100M Euros) v Small company schemes Increased intervention rates!! FOR MORE INFO... Ref: CIRD documentation from HMRC – substantial volume!
Some Common Issues Interpretation of Qualifying criteria –Companies often fail to recognise which costs are eligible Changing legislation Generation of robust documentation Time required to bring claim together Knowledge of the process to make a successful claim
Why Choose Us??? Scientists / Engineers – Not Accountants Stage by stage hand holding Our average claim is £52K compared with £43K national average Just over £1 Million reclaimed for our clients in past 12 Months 100% success rate
A Question… How much product would your company need to sell to generate an extra £50K in bottom line profits???
Case Studies Flame cutting company, Oldbury –£178,000 –Process innovation Strip Metal Processing Company, Birmingham –£100,000 –Product & Process innovation Drinks dispensing company, Milton Keynes –£40,000 –Product innovation
PATENT BOX – AN OVERVIEW
Patent Box – Aims To create a competitive tax environment for companies to develop and exploit patents in the UK To provide an incentive for companies to retain and commercialise patents in the UK and to develop new innovative patented products here To encourage companies to locate high-value jobs associated with the development, manufacture and exploitation of patents in the UK To encourage investment and growth in the UK
Patent Box – Aims A reduced 10 per cent rate of corporation tax on profits attributed to patents and other similar IP from 1 April 2013 Worldwide income from existing as well as new IP will be included. To enable this, the full benefits will be phased in over five years UK businesses can benefit regardless of how they use their patents In many cases the profit attributed to patents is calculated from total profits using a step-by-step method
Patent Box - Example HMRC suggest that a patent on a wing mirror leads to profits on the whole car being subject to 10% tax !! …..IP doesn’t need to cover the entire product
Contact Details Visit for more informationwww.bsmidlands.co.uk Darren Glover