R&D Tax Relief
Biotech is at the heart of the UK’s thriving and globally recognised leadership position in the life sciences. It is at the cutting edge of creating products that cure disease, feed the hungry, reduce our environmental footprint and fuel the world with cleaner energy. One of the reasons the UK has secured its leadership position is through their current R&D tax incentives system, that rewards companies investing in innovation. However, with spikes of HMRC disputing biotech’s R&D tax relief claims jumping by 372% percent in 2017 to 2018, we have to ask, where are biotech firms going wrong?
While the Government is pushing money into R&D, biotech firms are struggling to get a fraction of that money with £425 million in dispute in 2018 alone!
With a name like biotech, you would expect the companies to satisfy the R&D tax credits requirement of “resolving a scientific or technological uncertainty”, yet with HMRC disputing a record number of claims it is important to understand how to accurately present your R&D activities.
Biotech companies are continuously undertaking qualifying R&D activities that are designed to solve some of the greatest challenges facing our society. However, because the R&D in the biotech industry is unique, both in its development challenges and in its output products, it requires a R&D specialist. At Novel, we have R&D biotech specialists who know how to present biotech companies to HMRC in a way that would tick all their requirement boxes and maximise your claim while reducing the chance of any red flags.
With biotech research, testing and development requires a substantial amount of funds and number of years, so it is crucial for companies to take advantage of the R&D tax relief scheme to ensure they can continue developing products of tomorrow, and are given the time to grow into profitable, innovative companies.
What is R&D tax credit?
The UK Government’s Research and Development Tax Relief scheme is a way to encourage and reward companies that are investing in innovation.
What qualifies as innovation?
For tax purposes, R&D takes place when you are creating something that will advance the overall knowledge or capability in the field of science and technology. In simple terms, if you are solving industry problems, creating new software, process or materials or anything that could be considered Intellectual Property, you qualify.
Most biotech projects come with its own set of challenges and how you deal with them may potentially save you money, instead of costing you money. New products, living organisms, technologies and ways to solve a problem that haven’t been done before can all count toward an R&D tax credits claim.
- Are you developing a technology that can improve the extraction of a product from its environment to be used as biofuel, such as ethanol?
- Are you developing a technology that can extract a product or material from the environment to reduce pollution?
- Are you working on zero waste technology?
- Are you developing new medical devices, compounds or medicines?
- Are you creating algorithms and software that can analyse biotech data?
- Are you training AI to be used for biotech?
- Are you developing nanotechnology?
- Are you developing biomining bacteria that is capable of surviving in particular environments?
- Are you developing biodegradable products to be used in medicine, food, fuel etc?
- Are you developing a new type of fungicide that protects agricultural crops?
- Are you creating bio alternatives to traditional packaging?
- Are you creating new biomaterials to support different market sectors?
- Are you working on a way to find environmentally friendly fuel sources?
- Are you genetically modifying crops to support, improve or grow agricultural productivity?
- Are you developing or improving existing genetic modifications tools and techniques?
- Are you working on targeted immunotherapies?
- Are you trying to improve a product by increasing its shelf life?
Want to find out whether you can claim 33% of your R&D costs back?
There is a reason it's called innovation.
Think your project qualifies but we did not mention it above? Most likely! That’s why it’s called innovation. Get in touch with us and let us see whether you qualify for an R&D tax credit.
r&d tax credit for sMEs with novel
Making Sure Your Business Gets the Funding it Deserves
At Novel, we balance between the attention to detail and number crunching of an accountant, with our child-like disposition to anything new, unusual and innovative. To embody this philosophy we even named our company Novel.
We are on a quest to spread awareness about the R&D tax scheme so SMEs all over the UK can get funding to pursue their research. We know that to some businesses finding out about the R&D tax credit scheme was the difference between going bankrupt and continuing their work and starting to make money. To others it was more psychological, it acted as the earliest sense of recognition for their work. If you are an SME and think that you may qualify for an R&D tax credit, we want to hear from you!