FINANCIAL & LEGAL


What is R&D Tax Relief and should I claim?


Promotional Feature Despite being on the tax statute since 2000, Research and Development (R&D) Tax Relief remains an often overlooked and frequently misunderstood piece of tax legislation, but correctly applied for, it can off er a massive cashfl ow boost to your business through an R&D Tax Credit. In principle, any company could claim R&D


Tax Relief – it doesn’t matter what industry you’re in, whether you employ staff or work with contractors. If you are working on a defined project


and it involves the overcoming of scientifi c or technological challenges, then you could be claiming. It could be specifi c to you/your industry, a new or improved product, or it could be the development of a new in-house IT system that has been tailor-made to your unique requirements. R&D tax relief is part of the government's eff orts to make Britain the innovation nation, they are


“actively encouraging” small businesses to claim. In order to qualify for R&D Tax Relief, your


business needs to demonstrate that the advance your project was trying to achieve within the fi eld was signifi cant and couldn’t easily be achieved by another professional within the industry.


If you have an eligible project you can claim tax relief on a number of costs, for example: Material costs – if you are developing a prototype or you incur costs for software or utilities needed to run the project


Third party costs – payments to subcontractors


for research and


development activity or the costs of hiring workers through an agency to bring in specialist help for support on a project. Staff costs – wages and salaries, bonuses, pension contributions and employers NI contributions


Cooden Tax Consulting’s director Simon Bulteel has recently been recognised by Enterprise Nation as one of their Top 50 Advisers to SME Businesses. If this article has prompted any questions,


you can call Simon at Cooden Tax Consulting, on 01424 225345. Alternatively, visit The Business Show stand 310 at Excel London on 16th and 17th May


Cooden Tax Consulting exhibiting at Accountex with Weald Technology's record-breaking electric motorcycle


READER OFFER!


R&D Tax Relief was created by government to encourage innovation, quote “ES” online coodentaxconsulting.co.uk or phone 01424 225345 to start your claim and get a 20% discount


Financing Your Start-Up


Obtaining the right kind of funding is crucial in the early stages and vital for growth...


The internet is awash with companies


investors, venture capitalists, crowd funders, even


off ering investment for start-ups. Angel the government


is


trying to get a piece of the UK’s entrepreneurial action. Yet securing the necessary fi nancial support for a new enterprise


can be time- Reviewing your own fi nances is a


critical starting point. This helps reduce fi nancial waste and improve effi ciencies. Katie Massie-Taylor, co-founder of


Low interest


consuming, frustrating and ultimately fruitless. Entrepreneurs need to think carefully about


Going it alone Unless you are fortunate enough to be independently wealthy, trying to fund a new enterprise singlehandedly is challenging. However, it is important to exhaust the obvious avenues fi rst. Even where the start-up cannot go it alone


entirely, at the very least there will need to be some reserves to promote and operate the enterprise in its earliest stages, as well as get through investors’ doors.


rates have made it cheaper to secure credit


which route to take if they are to avoid wasting time and secure the best deal.


parent-tech app Mush, which secured £2m in venture capital, says: “The fi rst thing startups need to consider is whether they can reach a certain level of traction for their business before


securing funding.


You can often prove product market fi t on a shoestring. This will mean a far less dilutive round of funding and – crucially – will help you to


develop a lean mindset.” Talking to friends and family about fi nancial


backing is another early option. Borrowing from loved ones comes with potential pitfalls, but if arrangements are formalised and everyone knows what they are getting into, talking to nearest and dearest is a quick and relatively easy port of call. However, not everyone is blessed with


generous and sympathetic relatives, which means looking further afi eld. Low interest rates have made it cheaper to


secure credit and some banks are willing to lend, but strict borrowing criteria can exclude many businesses. More established enterprises,


493, 296


businesses were experiencing


signifi cant fi nancial distress


at the end of 2017


able to pay back loans within short time frames, or those that have collateral against which they can borrow, will have more success. Richard Wigley, innovation consultant at


GrantTree which helps secure funding for new businesses, says that bank lending may be limited to start-ups able to demonstrate they can earn money almost from the get-go. Wigley says: “Banks must be confi dent they


can get their money back, so they need to see that revenues can outstrip spending.”


Page 28


Nimble Accounting Everything Nimble do is founded in two core beliefs. As a new business owner, you simply don’t have the time to deal with bookkeeping and accounting, as your time is better spent growing the business. Secondly, a new company needs regular advice and management accounts, rather than just annually. nimbleaccounting.co.uk


65% of failed business owners blame fi nancial mismanagement for their downfall


Promotional Feature This is a shocking statistic that can be easily addressed with the right fi nancial support. Building a strong relationship with an


accountant who combines their expertise with the best business apps available empowers you, the business owner. Why not arm yourself with invaluable insight from cashfl ow visibility and business performance reporting and put yourself on the path to success? With low barriers to entry and


armed with excellent sales skills, recruitment companies generally experience high growth within their fi rst two years of trading. Usually that’s when business owners hit the wall and face the challenge of how to build foundations for sustainable growth.


Arm yourself with


invaluable insights like cashflow visibility


Transparency on business cashfl ow, incentivising your top billers, navigating the minefi eld of HMRC legislation and developing effi cient systems are the most common obstacles for scaling a recruitment business.


26 Be Your Own Boss distributed with


PLEASE NOTE !! This is a low resolution proof. NOT indicative of fi nal positioning


within the publication. Your advert will be place as per your booking.


Quite often recruitment business owners fall into the trap of either being the top biller


or carrying out tasks they shouldn’t be doing, such as bookkeeping and contractor management.


They


should be on the top deck directing the ship, not in the engine room! Recruitment Accountants, a


division of UHY Hacker Young, specialise


in supporting and


advising ambitious recruitment businesses. Sector expertise and commercial insight are paramount to the service, enabling clients to achieve their objectives and scale their business. Paired with the latest cloud-based technology such as Xero Accounting Software, business owners have all the fi nancial information and business advice to focus working on their business rather than in it .


GET IN TOUCH!


Marie Pegram, Partner 01462 687333 m.pegram@uhy-uk.com recruitmentaccountants.com


Images: Phil Burrowes of Avant Photographic


Facts corrrect at time of going to press. bit.ly/2GZjrr4 Images: istock.com


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