Research & development tax relief

It’s not too late to act!

Research and development (R&D) tax relief was introduced in 2000 to encourage innovation and enterprise within the UK economy. However, seven years on and with the deadline of 31 March 2008 for submitting prior claims now looming, many companies are still missing out on this huge tax saving opportunity.

Many companies are now growing increasingly concerned about the impending deadline but the important thing to remember is it’s not too late to act. At PwC we have a dedicated R&D team with plenty of resource to help companies meet the deadline in time.

Save your company time and cost in the long run

The Government has made several changes to the claims process creating an environment of uncertainty. In addition, HM Revenue & Customs (HMRC) has increased the level of scrutiny that it applies to certain types of claims and there is not yet a consistent approach to challenging a company's claim.

Our teams of specialists work closely with clients to submit R&D claims and put in place effective and long-term reporting systems to help companies comply with all relevant HMRC requirements. Such an approach eliminates HMRC scrutiny over future claims and translates into time and cost savings for our clients.

Potential issues

• Interpreting qualification criteria can be tricky with many companies incorrectly ruling themselves out by failing to recognise some qualifying activities and costs
• The six year time limit for R&D tax relief claims has been cut to two years. Companies, therefore, will need to act faster to file their claims
• Changing legislation means that companies may file their claims incorrectly
• Robust documentation to support a claim is essential
• Determining whether a company is an SME is not always easy, and some claimants may confuse the rules relating to SMEs and large companies

How we can support you

• Navigating you through the entire process with as much, or as little, assistance as you desire
• Advising on the application procedure and how to respond to HMRC enquiries
• Liaising with HMRC on your behalf and developing a bespoke methodology for your organisation that ensures compliance
• Agreeing practical processes for future claims with HMRC that are unobtrusive and easily repeatable.

In addition, PwC is in regular consultation with HMRC, the DTI, and industry groups. As a result of these relationships, we are well placed to communicate clients’ concerns and policy-related issues to relevant decision makers within Government.

At PwC, we combine our extensive knowledge of the legislative environment with our practical experience of working with companies to support clients through every stage of the application process, helping to ensure successful claims both now and in future accounting years.