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Why R&D firms talk about R&D Tax Credits?

14th Jul 2017
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The reason some R&D consultancy firms tend to talk exclusively about R&D Tax Credits and seemingly have no interest in the bigger picture is primarily because they are interested in the consultancy end of R&D process only; that is, these consultants can help businesses apply for and win R&D Tax Credits maybe, but not involve themselves long-term to ensure the business wins the R&D Tax Credits and then flourishes. In other words, these consultants don’t have focus on the wider vista that research and development opens up for businesses, like an expert accountant would.

Without a doubt R&D Tax Credits are a fantastic incentive for businesses to innovate and get back tax. But there are a lot of other ways research and development will enhance a business and secure it a place in the global economy.

The commercial benefits of research and development

Obviously an expert accountant is going to work with eligible clients to inform them about R&D Tax Credits and ready them and help them to apply if they qualify. However, in order to be eligible, qualifying businesses’ accounts must be up to scrutiny, it’s no good believing you qualify for R&D Tax Credits only to realise that there are holes in your accounts; it’s no good qualifying for R&D Tax Credits without expert financial planning.

Like anything else to do with business, basically, you need to plan. With a well thought out business plan that is modelled around an equally well thought out financial plan, then and only then is a business fit to benefit from R&D Tax Credits to the full.

r&d tax credit

The benefits of research and development to your business are wide-reaching: innovation enables your business to remain competitive, attract new customers in new markets, build customer loyalty, and may even offer opportunities to cross-sell other products and services. The products and services you improve or develop through research and development can enable you to:

  • Maintain and grow your competitive edge
  • Boost sales with new innovations, improvements, rebranding
  • Enhance your brand; embellish your reputation as an innovative business
  • Provide marketing and PR opportunities to improve your visibility
  • Increase profitability by looking at innovative ways to bring products or services to the market
  • Open up cross-border, international markets
  • Attract high-performing employees, promising graduates and school-leavers;
  • Enjoy new business partnerships
  • Attract investment and finance
  • Gain access to new supply chains; re-negotiate with existing ones for a better price
  • Reduce costs; an audit is essential really to ensure maximum benefits
  • Improve the quality of your products and services
  • Increase productivity and maybe reduce costs
  • Possibly get products or services to the market more quickly, improve cash flow (but note can equally affect cash-flow negatively long- or short-term)
  • Uncover other knowledge/innovations/technologies

Most R&D consultancies will do all they can to ensure eligible clients qualify for R&D Tax Credits, but what then? They won’t have the expertise a chartered accountant has, to help you with a financial and business plan, nurture you and your business, put focus on the wider vista that research and development brings to enhance your business, provide expert tax planning, and secure the commercial goals of your business and prepare it to win in the post-Brexit global economy.

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