R&D - website development

R&D - website development

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To qualify for R&D tax relief “the project must relate to your company’s trade”.  Can a company whose business is carried on via its website claim relief for the cost of website development or some of it?  Apparently the software people building it “resolved some scientific or technological uncertainty” (quotes from gov.uk).

Replies much appreciated.

Replies (8)

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By mabzden
06th May 2016 10:15

In theory yes. But it's hard to imagine how a new website is pushing back the frontiers of human knowledge, and I would have thought technological uncertainties about web technology were ironed out a few years ago.

I'm not saying no, but HMRC may take some convincing if they query the claim.

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By Tim Vane
06th May 2016 10:27

Highly unlikely that website development will qualify unless it is something completely radical. Just push it through advance assurance and see what they say.

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By TDRtax
06th May 2016 13:29

It's almost a certainty that HMRC would refuse it, unless that development includes significant improvements to the back end (html, css etc.)

Apply for advance assurance, which will give you certainty one way or the other.

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By Portia Nina Levin
06th May 2016 14:09

You are not from Sift are you? If you are it definitely does not qualify, because there needs to be a scientific or technological ADVANCE.

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By newman
06th May 2016 21:26

A director of the company already high on ‘clever accountants’’ advertisements on LBC was cold-called by another R&D experts explaining that a small fortune awaits her if she gets the accountant to make a claim. I suggested checking eligibility by answering questions in the HMRC advance assurance questionnaire, but this was cold-shouldered. It seems that some in the R&D relief industry believe that HMRC don’t normally check anything, or if they, exceptionally, do check, finding that there are no grounds for R&D claim is not a big deal. Are they right?

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Replying to newman:
By SteveHa
09th May 2016 15:32

Honestly, would you want to be on the receiving end of a client's anger if, having secured a repayment of 10s, if not 100s of thousand £, without due diligence, they then have to pay it all back to HMRC, with interest and penalties.

A lot of these so called specialists will likely become fly by night companies when the proverbial starts hitting the spinning blades.

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By hiu612
09th May 2016 17:12

Lots of negative responses so far, and possibly with some good reason. But IF they've achieved an advance in science or technology through the resolution of uncertainty then they may meet the criteria for R&D relief. As TDRtax says, you can always use advance assurance

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By rainbow
11th May 2016 16:33

Website development is not a revenue expense, but can it be regarded as a capital expense with the availability of capital allowances? It would seem a bit odd if no tax relief was available on such expenditure which clearly is of benefit to the business.

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