Encourage technical improvement

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Our government is very keen to encourage technical improvement in the way we conduct all aspects of commercial activity. Accordingly it provides VERY generous tax reliefs for activities that qualify, in its terms, as ‘Research and Development.’

While this includes the work undertaken by scientists wearing white coats and working in laboratories, it also covers the work done by entrepreneurs in improving the processes they use in their everyday business. The tax man may accept that anything you do which finds a way to overcome technical ‘uncertainties’ in your operations could qualify as research and development.

If you believe that your company undertakes the development of new products or processes, OR aims to duplicate existing products or processes in an improved way, AND consider that it ‘has made appreciable advancements in its field of work’, then you should be exploring this valuable relief further. ‘Appreciable advancements’ might include:

• The application of new materials to a construction project.

• The development of software to improve customer choice in most areas of retail activity.

• Improving the environmental impact of a traditional method of working in the building trade.

• Making cost reductions in an existing manufacturing process.

Action: Think laterally about the kind of “uncertainties” which you have found a way around and then discuss the possibility of making a claim with your accountant, or an advisor who, like us, has experience in this field.

“The tax man may accept that anything you do which finds a way to overcome technical ‘uncertainties’ in your operations could qualify as research and development.”

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Author: Businesswise Accountant

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