R&D Tax Grant Service
Discussion
StevieBee said:
The basis of the claim was a lot of work we'd put into adapting a pre-existing bit of software for an application beyond that for which it was intended within a sector and type of work that it was thought previously unworkable. We were able to demonstrate significant technological gains which has translated into tangible economic benefit, profitability, job creation and so on.
I would imagine the basis of your claim would depend upon how much you were adapting existing software and how much you were advancing technology? I don't think the fact you made gains and found it useful would be relevant based on my understanding of the criteria.But if you were spending circa £20k presumably that must have involved writing new code, new algorithgms etc? What do the company who were supporting your claim now say?
EddieSteadyGo said:
StevieBee said:
The basis of the claim was a lot of work we'd put into adapting a pre-existing bit of software for an application beyond that for which it was intended within a sector and type of work that it was thought previously unworkable. We were able to demonstrate significant technological gains which has translated into tangible economic benefit, profitability, job creation and so on.
I would imagine the basis of your claim would depend upon how much you were adapting existing software and how much you were advancing technology? I don't think the fact you made gains and found it useful would be relevant based on my understanding of the criteria.But if you were spending circa £20k presumably that must have involved writing new code, new algorithgms etc? What do the company who were supporting your claim now say?
The point of debate in our case surrounds a line in the criteria that reads something along the lines of 'technical advancement for societal gain'. All we did was adapt the process of application rather than the application itself. I say 'all we did' - it was a monumental task but we didn't write code or anything. We took a pre-existing application and appended to it a new process that enabled the extraction of critical information which could then be used to inform key functions of the project it was applied to which in turn increased the quality and depth of insight we were able to provide to our clients.
I'm not going to go into the finite details but to give you an idea, we went from only be able to report to a client that "there exists issues in these geographic areas' to; "there exists issues in these roads on these days at these times for these reasons". And that was provided at less cost to the client and at rate more profitable to us. Plus the end-outcome was improved public services.
The company is reviewing and we are due a meet next week.
StevieBee said:
The £20k is representative of the tax (in whatever form may apply) that has previously been paid in direct relation to endeavour you then claim R&D credits for. In our case, this was spread over a two-year period. As with all these types of rebates, it's just a case of getting your own money back.
The point of debate in our case surrounds a line in the criteria that reads something along the lines of 'technical advancement for societal gain'. All we did was adapt the process of application rather than the application itself. I say 'all we did' - it was a monumental task but we didn't write code or anything. We took a pre-existing application and appended to it a new process that enabled the extraction of critical information which could then be used to inform key functions of the project it was applied to which in turn increased the quality and depth of insight we were able to provide to our clients.
I'm not going to go into the finite details but to give you an idea, we went from only be able to report to a client that "there exists issues in these geographic areas' to; "there exists issues in these roads on these days at these times for these reasons". And that was provided at less cost to the client and at rate more profitable to us. Plus the end-outcome was improved public services.
The company is reviewing and we are due a meet next week.
What was the outcome here?The point of debate in our case surrounds a line in the criteria that reads something along the lines of 'technical advancement for societal gain'. All we did was adapt the process of application rather than the application itself. I say 'all we did' - it was a monumental task but we didn't write code or anything. We took a pre-existing application and appended to it a new process that enabled the extraction of critical information which could then be used to inform key functions of the project it was applied to which in turn increased the quality and depth of insight we were able to provide to our clients.
I'm not going to go into the finite details but to give you an idea, we went from only be able to report to a client that "there exists issues in these geographic areas' to; "there exists issues in these roads on these days at these times for these reasons". And that was provided at less cost to the client and at rate more profitable to us. Plus the end-outcome was improved public services.
The company is reviewing and we are due a meet next week.
DSLiverpool said:
I’ve left Velstar now but we had no issues on 4 claims with the last one over 6 figs.
I've had no real issues either. Just received about 4 months ago a cheque for £45k. One point I would say, this time the adviser company we used asked LOTS more questions, many of which felt very challenging to answer. It felt almost like the adviser company was the gate-keeper of the process, rather than it being HMRC.
The adviser company has also employed software and coding experts which they brought onto the call to specifically challenge the detail of what I was saying. Felt far more scrutinised than I did the previous time.
However, we must have "passed" as we received the money.
Takemeaway said:
Interesting subject and one which i've been considering too
Does anyone know if HMRC are still operating a pay now, assess later policy?
yes they are and pretty much always have doneDoes anyone know if HMRC are still operating a pay now, assess later policy?
I would be careful with your claims - its easy to mess them up. I do tax due diligence as a day job and R&D tax credit claims are one of the areas we focus on as there are always errors (a bit like national minimum wage to be honest). Its very difficult/impossible to get tax insurance on a deal that covers R&D claims which tells you something.
Ive seen massively incorrect claims submitted by "specialist" r&d consultants - but i mainly work in Private equity and they will think the client company is "small" without realising it isnt because its linked to other businesses owned by the same fund.
Eric Mc said:
StevieBee said:
The £20k is representative of the tax (in whatever form may apply) that has previously been paid in direct relation to endeavour you then claim R&D credits for. In our case, this was spread over a two-year period. As with all these types of rebates, it's just a case of getting your own money back.
The point of debate in our case surrounds a line in the criteria that reads something along the lines of 'technical advancement for societal gain'. All we did was adapt the process of application rather than the application itself. I say 'all we did' - it was a monumental task but we didn't write code or anything. We took a pre-existing application and appended to it a new process that enabled the extraction of critical information which could then be used to inform key functions of the project it was applied to which in turn increased the quality and depth of insight we were able to provide to our clients.
I'm not going to go into the finite details but to give you an idea, we went from only be able to report to a client that "there exists issues in these geographic areas' to; "there exists issues in these roads on these days at these times for these reasons". And that was provided at less cost to the client and at rate more profitable to us. Plus the end-outcome was improved public services.
The company is reviewing and we are due a meet next week.
What was the outcome here?The point of debate in our case surrounds a line in the criteria that reads something along the lines of 'technical advancement for societal gain'. All we did was adapt the process of application rather than the application itself. I say 'all we did' - it was a monumental task but we didn't write code or anything. We took a pre-existing application and appended to it a new process that enabled the extraction of critical information which could then be used to inform key functions of the project it was applied to which in turn increased the quality and depth of insight we were able to provide to our clients.
I'm not going to go into the finite details but to give you an idea, we went from only be able to report to a client that "there exists issues in these geographic areas' to; "there exists issues in these roads on these days at these times for these reasons". And that was provided at less cost to the client and at rate more profitable to us. Plus the end-outcome was improved public services.
The company is reviewing and we are due a meet next week.
HMRC upheld their view that the claim was void. They said that the claw-back would be done via our year end tax. We had a telephone conference call with them and the company that arranged the claim and I made the point that it seemed wrong that the claims were approved - then assessed and that 18 months between the two was too long. I also reminded them that there was an additional £6k added to the original claim that we were unaware of that was suggested by HMRC to the company that would be valid. You can't determine a shrug on the phone but that's pretty much what their response was.
It boiled down to the work upon which the claim was made was not sufficiently 'technical'. There was no tangible outcome other than an improved service. It seems to me that they want to see physical things; products, code or whatever. I could and would argue this point but it it what it is.
The company that made the claim on our behalf were liable for only for the refund of their commission - but only when we refund HMRC. Nowhere in their T&Cs, marketing gumph, or anywhere else did they state the possibility of claims being recalled. Our solicitor suggested a claim against them for professional misconduct (failure to properly and clearly explain things) would be worth pursuing. However, the company has since gone into liquidation so no refund and no case to answer.
Not that it matters anyway as my company that made the claim has also gone into liquidation, the demand to repay the R&D grant being the straw that broke the camel's back. The only creditors were HMRC - the R&D grant and a chunk of a BB Loan.
I'm annoyed with myself in many respects as I questioned the validity of what we do right from the very start and I should have pushed this further but the company were insistent that all would be good.
db10 said:
Takemeaway said:
Interesting subject and one which i've been considering too
Does anyone know if HMRC are still operating a pay now, assess later policy?
yes they are and pretty much always have doneDoes anyone know if HMRC are still operating a pay now, assess later policy?
I would be careful with your claims - its easy to mess them up. I do tax due diligence as a day job and R&D tax credit claims are one of the areas we focus on as there are always errors (a bit like national minimum wage to be honest). Its very difficult/impossible to get tax insurance on a deal that covers R&D claims which tells you something.
Ive seen massively incorrect claims submitted by "specialist" r&d consultants - but i mainly work in Private equity and they will think the client company is "small" without realising it isnt because its linked to other businesses owned by the same fund.
In retrospect, we got sucked into the idea of this unexpected windfall at a time when it was very welcome. We clearly picked the wrong company to help us but have to also take a share of blame for allowing our usual diligence and cynicism to be left on the shelf.
To give you an idea, one of the things the company claimed for was a trip to New Zealand. This was a field study and research visit to determine the market viability of our services, for which we got 50% of the costs paid from a grant from a part of UK Trade and Investment. I question whether it was correct and even moral to claim more money from the government having already had half the costs covered by them. They insisted it was.
Edited by StevieBee on Monday 22 November 11:22
Edited by StevieBee on Monday 22 November 11:26
Thread revival as I can't find the answer after a search:
Do these R&D refund companies always charge a percentage of the 130% enhanced amount, or do some charge on the original costs plus the 130%, so a percentage of 230% in total!
I have an accountant trying to charge that and it doesn't seem right to me.
Do these R&D refund companies always charge a percentage of the 130% enhanced amount, or do some charge on the original costs plus the 130%, so a percentage of 230% in total!
I have an accountant trying to charge that and it doesn't seem right to me.
Rich135 said:
Thread revival as I can't find the answer after a search:
Do these R&D refund companies always charge a percentage of the 130% enhanced amount, or do some charge on the original costs plus the 130%, so a percentage of 230% in total!
I have an accountant trying to charge that and it doesn't seem right to me.
Straight cut of the money claimed - don’t use an accountant they don’t know as much as a specialist Do these R&D refund companies always charge a percentage of the 130% enhanced amount, or do some charge on the original costs plus the 130%, so a percentage of 230% in total!
I have an accountant trying to charge that and it doesn't seem right to me.
DSLiverpool said:
Straight cut of the money claimed - don’t use an accountant they don’t know as much as a specialist
Got you, thanks. So if the company is loss making we will only be claiming money on the 130% enhanced element, won't get a refund for the other 100% which are just standard costs, as they are just increasing the losses carried forward, correct?I wish they weren't using an accountant, but too late to change this year, I will next year!
Rich135 said:
I wish they weren't using an accountant, but too late to change this year, I will next year!
Speaking as an accountant, I agree with DSL. It's a big risk unless they do this day in/day out. I can put you in touch with an R&D firm who will review the claim for you if you want.MaxFromage said:
Rich135 said:
I wish they weren't using an accountant, but too late to change this year, I will next year!
Speaking as an accountant, I agree with DSL. It's a big risk unless they do this day in/day out. I can put you in touch with an R&D firm who will review the claim for you if you want.MaxFromage said:
Speaking as an accountant, I agree with DSL. It's a big risk unless they do this day in/day out. I can put you in touch with an R&D firm who will review the claim for you if you want.
Thanks for the offer, I have one I use for another company so will encourage them to move over after this year.Any current recommendations for R&D tax specialists please. Have been using Leyton for a few years - received a notification that the new application would be dealt with on the same cost basis as previously, but upon review of the T's & C's small-print noticed that the fees had doubled.
Not a fan of dishonesty so time to move on.
Not a fan of dishonesty so time to move on.
MaxFromage said:
Rich135 said:
I wish they weren't using an accountant, but too late to change this year, I will next year!
Speaking as an accountant, I agree with DSL. It's a big risk unless they do this day in/day out. I can put you in touch with an R&D firm who will review the claim for you if you want.I remember taking a massive loss time wise on it when first discussed with a client a number of years ago, but sorted my CPD and allowed me not to let my clients be ripped off on the whole percentage of claim basis - would have cost them tens of thousands for only tens of hours. I'm lucky that I don't have to necessarily clear a timesheet like many do which may prevent them being able to commit to the type of reading required.
Fair bit of groundwork required, client has to make sure all is in order and there's a specialist office who you can speak to who are (were) very helpful and you can submit the work. For one client we've now implemented a system where R&D hours for employees are logged on timesheets which require descriptors as a result of a couple of queries that arose (but never prevented) Just make sure you have a paper train for everything, we even had to show the CVs of the employees to prove they had the expertise to 'advance' the product at the start and the company did provide a presentation available to accompany the claim if required.
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