Essential Things to Understand About R&D Tax Credit
You need to know that R&D tax credits can surely be somewhat confusing. There are certainly new laws that are being passed every years for the past decade and there are also those businesses that are not sure about the benefits which they can obtain from the government.
Almost any time, money or resources that is spent with that goal of advancing and also improving the products or the processes of a certain company can actually be considered part of research and development. This means that nearly any company that is making anything can get the R&D tax credits. This may include the improvement of an existing software or testing such ideas and creating something futuristic such as a flying car or any type of research and development costs can definitely count to tax credit. In the UK, any company regardless of size that is spending money on the research and development may qualify for such tax credits.
The amount of such tax credits which you may get would have to depend on the size of the business that you have and also where the operations are based. The UK and also the US have different policies in offering R&D-based tax relief but those qualifications of obtaining tax credits are almost the same. In general, the smaller the company is and also the less revenue they are producing, the bigger percentage of the R&D costs they can relieve with the tax credits.
To be recognized as a small or a medium business in the UK, the business should have less than 500 people and must have a turn over of less than £100 million or should have such gross assets of not above £86 million. Such businesses can get that significant advantage from the recent tax credit legislation. If the SMB is really lucrative, then about 26 percent of the R&D costs may actually be subjected to tax credit.
To be qualified as a large business in the UK, one needs to have more than 500 people or the turnover should be amounting to more than £100 million and gross assets must be over £86 million. The tax relief is given at 11 percent of such qualifying R&D expenditure. This may just be one third of the maximum rate for the SMB but the total credit that one may claim doesn’t have a ceiling.
For you to be able to take advantage of such R&D tax credit, then it is quite important that you really work with the R&D associates so that you will be properly assisted and for you to really get the most of out of it. Simply go online and start talking to them to get more information.