R&D Tax Relief: Uncertain times need support

HMRC supports businesses turning to Research and Development (R&D) to help make positive changes

The Grenfell tragedy in June 2017 exposed some significant shortfalls in the use of materials in construction, particularly when it came to fire safety. What had usually been routine installations and simple material choices were quite rightly thrown right back to the drawing board to make sure such a tragic loss of life never happened again. This event caused much uncertainty within the insurance market and made it increasingly difficult to secure commercially viable premiums. 

From a different perspective, this uncertainty has presented a real opportunity for construction professionals to see if they are eligible for Research and Development Tax relief. The scheme set up by HMRC back in 2000 provides a reliable funding mechanism for activities which may be considered more uncertain and risky however,  if achieved, could create an appreciable improvement to current options available. You can be forgiven for thinking that R&D is a word only associated with lab coats! The reality is that it’s a service that has already benefited over 43,000 companies, in receiving an average of £50,000 per claim.

If you have clients within the with construction industry who are working towards creating new or innovative solutions to solve or improve current issues, they should consider if R&D tax relief is relevant to them.

Examples of qualifying activity could be:

• Fire resistant cladding manufacturing
• Installation and processes that creates an appreciable improvement
• Land remediation
• Safe waste disposal of materials
• Trials, testing and prototyping

To be eligible, in the eyes of HMRC, applicants would need to be able to demonstrate that the outcome of their activity could create an appreciable improvement to a challenging problem that had not been resolved by a competent professional.

When considering if R&D applies to your clients, the key questions to ask are:

1. Does my client’s company have any existing or past projects that aim to advance in a field of science or technology?
2. Did/does the project present scientific or technological uncertainties where an expert on the subject could not see or provide a solution? This means that your client’s company or experts in the field they work in, cannot already know about the advance or the way that it was achieved
3. Can your client’s company demonstrate that their project required research, testing, and analysis to complete development?

 If you answer ‘yes’ to all the above, it’s very likely that having a conversation about R&D could be highly valuable to you and your clients. Judging which projects and activities will qualify for R&D is usually the area where most people seek help and as we’re part of the Ardonagh Group, we are best placed to help you with this. Plus as we offer our services on a 'no win, no fee basis' there’s no cost to the business or the client and if successful, PfP will pay you an ‘introducer fee’. If you would like to find out more or talk to us about a client, please call 0345 307 1177 or email info@pfp.uk.com.