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Markel Tax

18 May 2020

What is keeping the R&D tax team busy?

As we all adjust to new working practices, it has been enlightening to see how everyone here at Markel Tax has adapted to working within the Government Covid-19 guidelines, and has come to understand that the new ‘normal’ is for the greater good and here to stay, for the immediate future at least.

Our working day has been transformed through the team’s willingness to embrace technology, with video calls simply becoming the way meetings are now conducted. Holding our technical meetings remotely has enabled the R&D tax team to offer continued and ongoing support by ensuring we retain that vital, albeit now virtual, face-to-face interaction with our clients and referral partners alike.

The influence of government support in the form of business interruption loans and Covid-19 related initiatives has seen an increase in the number of accountants enquiring about the impact this may have on restricting future R&D claims. We anticipated that, unless the state funding is directly utilised to fund R&D activity, it is unlikely that businesses will be restricted under the general state aid rules.

There is also a need for clarity with regard to the interaction of Covid-19 related funding and continued, or new, access to the R&D tax relief scheme. Advisers and clients may remain assured that both these key sources of funding can work in harmony. Furthermore, they should be considered in equal measure, to determine any potential impact this would have. When planning deployment of any grant funding, it is prudent to ensure that any available tax incentives and reliefs are included in this exercise from the outset, in order to maximise their impact on a business.

Markel R&D consultants are seeing a trend whereby existing clients, keen to prioritise their R&D claim, are now contacting us or replying to our calls immediately after their year-end has passed, rather than it taking the usual emails and phone calls to elicit a response! This eagerness to submit R&D claims earlier than usual, combined with HMRC’s stated commitment to process 95% of all claims within 28 days, is proving to be a fast and efficient way for our clients to obtain an injection of cash into their businesses.   

We are also seeing a rise in the number of businesses electing to bring forward their year-end, in order to claim for the current accounting period, as well as the previous two years. This again is a method of generating cash flow and providing immediate stability and certainty. This approach is worthy of consideration across all sectors at this turbulent time.

Identifying the full potential value of R&D activity to a business and undertaking a claim can be complex to navigate, however, at Markel Tax we successfully submit over 750 claims a year, made possible by a team of highly experienced in-house technical consultants with science and technology backgrounds in many sectors. The team is exceptionally well-qualified, with our staff holding PhDs and degrees across an array of specialisms. Furthermore, numerous staff hold CTA, ATT, ACA and other professional qualifications, which secures a sound financial basis to dovetail with our technological know-how.

For further information and support with these, or any other tax related issues, please contact Justine Dignam, Director of Tax Incentives and Reliefs or call Markel Tax on 0114 2364 457.

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Next article in series

15 May 2020

What is keeping property tax consultants busy?