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Benefits to you

Quick Enquiry

How much is
a claim worth?

The amount you can claim depends on several things, including:

  1. How much you have spent on R&D and on what
  2. How profitable you’ve been
  3. The years when you did the work

A wide range of expenditure can be classified as qualifying R&D spend. Although this will be primarily labour costs, other spending can often be included. 
You will receive the tax relief as a reduction in your corporation tax bill or as a tax credit.

“Marches Global Limited have been very impressed with MSC Associates professionalism in the handling of our R&D tax credits. They clearly know what they are talking about and we will be using them again for this complicated process.”

Clive Haughton, Marches Global

Profit Making Companies

If you make a profit, you can use the enhanced research and development spend to reduce your corporation tax bill.

For example, R&D expenditure of £50,000 where the company has made a profit of £150,000

 

Loss Making Companies

If you make a loss, you can still benefit from R&D Tax Relief. The enhanced R&D expenditure is added to your losses and these are available to carry forward or back to set against profits or you can take a 14.5% cash payment.

For example, R&D Tax Relief for expenditure of £40,000 where the company has made a loss of £50,000 


Calculation Step

Amount

R&D Expenditure

£50,000

R&D Relief

£50,000 x 130% = £65,000

Normal taxable profit

£150,000

Taxable profit less R&D Relief

£150,000 - £65,000

Revised Taxable Profit

£85,000

Calculation Step

Amount

R&D Expenditure

£40,000

R&D Enhancement

£40,000 x 130% = £52,000

Normal Trading Loss

£50,000

Trading Loss less enhanced R&D Relief

=£50,000 + £52,000 = £102,000

Loss available to carry forward or back for Corporation Tax purposes

£102,000

OR convertible to tax credit payment =£92,000 x 14.5% = £13,340
And a further £10,000 available to carry forward or back for Corporation Tax purposes £10,000
Chris Pinches
“As an Accountant I am more than happy to talk through the detail of the numbers involved in tax relief claims and the most efficient way that it can work for your business.”


Chris Pinches, MSC Associates