What are R&D Tax Credits?

Research and development (R&D) tax credits are a government tax relief that rewards innovative UK companies.

R&D tax credit relief is on average 33p in the £1 of all qualifying costs.
Companies that spend money developing new products, processes or enhancing existing ones.

Research and development (R&D) tax credits are a government tax relief scheme that reward innovative UK companies. They provide a source of cash that a business can use towards developing new products and processes or enhancing existing ones.

On average, you can claim 33p of every £1 spent on innovation. In 2016-2017 alone, the government paid out a massive £3.5 billion as R&D tax credits. That’s a large pool of money that your business may be missing out on!

What does R&D mean for my business?

The R&D tax credit scheme means that a portion of the money you invest in ‘innovation’ can be claimed back. Innovation refers to any company that invests in new processes and products, or enhancing existing ones.
You don’t need to be wearing a laboratory coat to claim for R&D – it’s a scheme that can benefit any business, from small enterprises through to national corporations.

To get paid, you’ll need to submit a R&D tax credit claim, where you’ll either receive a cash payment and/or a Corporation Tax reduction.

To claim R&D tax credits, your business needs to:
● Be eligible for corporation tax as a limited company in the UK.
● Have carried out ‘innovation’ – which refers to qualifying R&D activities.
● Have paid money towards these activities/projects.

What counts as R&D?

To submit a claim you have to identify what constitutes R&D in your business. Fortunately, there’s a wide scope for R&D across all sectors of businesses. When you claim for the first time, you can typically claim for your last two completed accounting periods – which essentially means you can often have cash waiting you may not have ever considered.

Examples of sectors that can claim for R&D include:

Food and Drink R&D Tax Credits: an estimated 1% of claims for R&D in this sector have been paid out, meaning you’re likely in the 99% missing out on cash for your business.

Life Science R&D Tax Credits: the UK is a global leader in this sector, and it’s one that is often at the forefront of innovation. Life sciences R&D tax claims are therefore great opportunities for businesses to claim back money.

Science & Technology R&D Tax Credits: Many people associate R&D with sciences and technology, making it a common area for claims. If you’re involved in this sector, get in touch. However, R&D is often wrongly assumed to only be relevant to this sector.

Manufacturing & Engineering R&D Tax Credits: The ideal claim candidates, as you probably spend money on creating new processes or enhancing existing ones. R&D is regularly performed in manufacturing, so make sure you get in touch and claim what you deserve.

Of course, all sectors are eligible for R&D, though you will likely need help spotting what counts as R&D and how to lodge claims.

How to claim for R&D

That’s where we step in. If you’re typing what are R&D tax credits into Google, chances are you may need assistance understanding exactly what qualifies as R&D and how to submit your claim. At Lumo, we’re a straightforward R&D tax company that deals in one thing and one thing only – helping businesses like your claim R&D tax credits.

We know the language of the tax man, we know what makes a successful claim and what doesn’t, so let us do all the legwork for you. The government has created R&D tax credits to support innovative businesses, but very few submit a claim and get money back into their business. Make sure you do.

What activities are eligible for R&D tax savings?

During the R&D tax claim process, we will analyse what has gone into your R&D process to work out how much money you can claim. This includes:
● Staff salaries and expenses
● Freelancer fees or subcontractor work. This may also include payments made to the subjects of clinical trials.
● Materials and consumables. This even extends to utilities and other factors
● Certain types of software

With so many eligible sectors and criteria, your business could be missing out on thousands of pounds. Try our R&D tax calculator to see how much your R&D tax claim could be worth….

How does it work?

Ready to get started with your claim?

Are you ready to find out how much you could be due? You've got two options, request a callback and we will be in touch or answer a couple of questions via our eligibility checker

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Who is benefitting
from R&D Tax Credits?

R&D Tax For Life Sciences Industry

Life science is an area that has seen a huge amount of investment over the last few years and that doesn’t show any sign of slowing down. Improvements to healthcare have come on leaps and bounds with the advent of new technology. But all of this investment needs cash behind it to support the future. The government has identified this as one of the key areas the UK leads the world and this is why it is supported with R&D tax credits.

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“Big thanks to the Lumo team for the excellent work on our R&D tax claim. You make the process really easy and getting 3x the money we expected from HMRC is an awesome feeling.

Huw Evans - MD & Technical Engineer - Arnia

Huw Evans - MD & Technical Engineer

Arnia

R&D Tax For Food & Drink Industries

We have been helping food and drink businesses across the UK get money back into their business through R&D tax claims. It's estimated that only around 1% of eligible R&D tax claims for the food and drink industry have been paid out - this is a phenomenal figure that we have set out to improve.

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“We have now received a substantial sum that, at the beginning, we were unaware we could claim back, and our systems are now set up to ensure the information for next year’s claim will be readily to hand. An exceptional benefit that has given us a great boost to our cash.

John Shepherd - Founder - Hooba Foods

John Shepherd - Founder

Hooba Foods

R&D Tax For Science & Technology Industries

Science and tech are a constantly changing environment. Coming up with new ideas and solutions for your clients is part and parcel of the everyday business. You have probably heard about R&D tax credits. To some, it seems nigh on impossible to get but the truth is that there are many different areas of these industries that are eligible for R&D tax credits. All you need to know is what is part of a valid claim.

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“The process was very straightforward with no disruption to our business, The simplicity of making a claim through Lumo has given us the confidence to invest more heavily in innovative projects.

Paul Lofthouse - Business Development Director - Waymark IT

Paul Lofthouse - Business Development Director

Waymark IT

R&D Tax For Manufacturing Industry

R&D is something that many manufacturing or engineering companies carry out on a regular basis. Making new products, developing existing ones or changing processes keeps companies in these industries up with the competition. Research and development is the way that helps to fund the future investments.

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“Lumo have submitted R&D claims for us over many years now and have been instrumental in obtaining us substantial tax refunds which have enabled us to significantly expand our business by opening a new factory

Michael McNicholas - FM Coatings

Michael McNicholas

FM Coatings

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