R&D Tax Credits for smaller tech companies

We’ve all heard about R&D Tax Credits. But how many of us (in this instance I am wearing the hat of UnifiedVU) have actually claimed it? When you speak to most accountants or R&D Tax Credit experts, they make it sounds almost as your innovation isn’t innovative enough to claim.

Secondly, if your potential claim is small, it would not make sense for the R&D Tax Credit Expert to get out of the bed and help you. What if there are software products out there which could help founders claim R&D Tax Credit without having to pay for an accountant or an R&D Tax Credit Specialist?

Whilst I do not claim to possess any expertise on this matter, I would like to share the steps I took to submit my first ever claim in November 2018.

 

Preparing the Innovation Report for Claim using RDVault

In Manchester of all places, RDVault, a new tech product startup has sprung up to help Tech Founders like myself claim overdue R&D Tax Credits with ease, just like we use any other Software-as-a-Service (SaaS) product.

RDvault founded by Techcelerate Product Market Place Member Shoayb Patel has been built with the end user in mind empowering businesses and advisors to swiftly claim R&D tax credits. It integrates with your accounting software, in my case with Xero, allowing you to quickly identify the costs associated with the innovation. It then calculates the total R&D qualifying P&L expenditure under the HMRC SME Scheme. 

It further facilitates via a questionnaire to start writing the Innovation Report. At the same time, it calculates the exact amount you are eligible to claim. 

 

 

Filing with HMRC through InstaFile

Once the Innovation Report is completed via RDvault, the next step is to file the Corporation Tax Return with R&D Tax Claim. Unfortunately, the version of HMRC software available online in Nov 2018 did not allow me to complete the tax form when there was an R&D Tax Claim involved. You would need specialist software for filing.

In our case, we selected InstaFile for the submission. Since my filing, InstaFile has been acquired by Xero and incorporated into it’s product.

 

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