There are currently a lot of players in the exceptionally crowded space of R&D tax credits. As a consequence, there are probably a lot of conflicting messages. These range from “get hundreds of thousands of pounds in 30 minutes with zero risk” to “the wolf is at the door so proceed with serious caution”. As always the truth is somewhere between those two positions.
But rather than focus on why our competitors are wrong I would much prefer to think about what good advice I have for our clients, and potential clients.
Four things to help you select your R&D tax relief advisor
- Time – Think about how much time your advisor spends on your claim. We would suggest that 30 minutes isn’t enough time to get to know your business, never mind making a compliant claim.
- Cost – Think about the cost vs the value to your business.
- Risk management – You should be aware of the risks of an HMRC enquiry and understand what quality assurance processes are in place with your advisor.
- Support – You should know that your advisor will have your back. But look beyond the website claims, do they have enough R&D tax credit experience to offer genuine support if you do face an enquiry.
We’re here to help – If you’re in any doubt speak to us. We’re happy to discuss your concerns whether you’re an existing client or not.
Is there a right way to claim R&D tax credits?
But it’s not as black and white as that sounds. Right is subjective. There is a choice of processes, fees, advisors and what is right for one business may not be right for another. But getting it right has never been so important. We are seeing compliance issues creeping in and 100 new HMRC inspectors have been recruited to investigate tax claims, with the majority focusing specifically on R&D tax relief. Fingers crossed that those new inspectors will go hunting and find nothing but fully compliant claims. But my suspicion is that some players may be found wanting. Some haven’t been subtle about cutting corners and I do hope that behaviour is stamped out very, very quickly.
So what does right mean for a GovGrant client and to answer that, I think about the questions we hear from clients and more commonly prospective clients.
How long should the R&D tax relief process take?
Some might suggest that they can build a claim in thirty minutes, but we think that for most companies that is disingenuous. And often a false economy.
The right process is one that starts with open questions, at the top rather than starting with a conclusion and making it fit. GovGrant thinks about the business in its entirety so we then know where to focus, challenge and explain further. This can be quick for some but, for others, it can be more time consuming, although we always do the lion’s share of the work required.
We never waste time, it’s too precious to our clients. Instead, we ask direct questions that can sometimes be uncomfortable but it is the most effective way to deliver the most value from your claim.
But that’s only one part of the process. What most clients don’t see is what happens behind the scenes – our process, checks, quality assurance. We see our roles as being custodians of the R&D tax schemes. Morally, it’s important to us that taxpayers’ money only goes to the right places. It’s in no one’s interest, not least HM Treasury, for the schemes to get a bad reputation. The purpose is to grow the UK economy, to deliver the most bang for the buck.
We have a two-stage review process, a first level that is aligned more to the client and a second level that is totally independent and tries to step into the shoes of HMRC. This can sometimes extend the process slightly but it is invaluable. Any time spent mitigating the risk of an enquiry upfront will protect against the much greater time commitment, and potential financial penalties from HMRC, if you were to find yourself in the position of an enquiry.
So the answer is that the process takes as long as it needs to; to identify all compliant activity and qualifying costs, whilst ensuring it is robust, evidenced and fully maximised. It’s why we don’t work to a fixed fee and it’s why we don’t leave you to do the work.
How much does an R&D tax relief claim cost?
R&D tax relief is the same as any other product or service and the old adage rings true, you get what you pay for. That’s not to say everyone wants the premium option all the time, it’s about getting the appropriate advice for the appropriate cost in full consideration of what you are buying.
We understand a prospective client might select someone else, we are not for everyone. But we do hope that clients go through a well-informed buying cycle. If that results in a low fixed fee or percentage, and they have considered everything beyond the price tag, then that could be the right decision for them.
For others who may have a greater consideration because of a certain point in their development and growth, they may suspect that much of their commercial value is held in their IP and R&D and it’s worth getting a full and frank evaluation of those assets. They might be looking at a process of due diligence, contractual negotiations, or strategic review that demands that they have a thorough understanding of the innovation at the heart of the business. That’s when GovGrant can make all the difference.
To find out more about how GovGrant can support your business contact us.
