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Tax Cloud is an R&D Tax Credits claim portal.

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5 Ways Accountants Can Help Start-Ups Make Money

14th Aug 2020
Brought to you by
tax cloud

Tax Cloud is an R&D Tax Credits claim portal.

Share this content

Supporting your start-up clients is about so much more than just tax returns. There are many ways you can help them raise cash too - find out more.

Increasing your value

We’re not just talking about tax returns here; accountants play a crucial role in guiding their clients’ business decisions and supporting them through thick and thin.

Here we’ve looked at ways you can help start-ups in particular make money - invaluable in this tough economic climate.

You make reliable decisions

Most start-up owners dream about making it big and earning millions, and it’s easy to get carried away. As their accountant, you can keep clients grounded by helping them make reliable business decisions around major purchases, investments and growth through accurate business modelling, cost-benefit analysis and margin analysis. This will allow entrepreneurs to create management strategies for their finances and resources, hopefully bringing about future profits that can fund their business expansion efforts.

Satisfying investors

Did your client benefit from outside investment to get their start-up off the ground? If so, the investor(s) will very likely want to see hard evidence that the business is doing well. As their business accountant you can help to prepare profit forecasts and other reports, therefore maintaining investor confidence and keeping that line of financing open.

Keeping a clear view of revenue vs. expenses

Accountants can provide start-ups and SMEs with a range of valuable metrics that will monitor their progress. These can include details about the ratio of revenue to salaries and other expenses, as well as ROI on marketing activities and much more. If possible you should aim to share this information with clients via the cloud, meaning there’s no face-to-face requirement to meet with your client. They will also be able to access the information whenever and wherever they want.

Tax planning

Your clients will be no doubt be great at what they do, but tax affairs can be daunting especially for fledgling start-ups. Your specialist knowledge means you can advise them on a range of tax planning options, tax efficiency, and how to make the most out of each tax year. You’ll also save them money by keeping on top of tax deadlines.

Growing the business

By being there right from the beginning, accountants that work with start-ups and SMEs can be there while the business is growing. You will come to understand the business owner’s goals and plans, placing you in the best position for advice on this growth. You can also help them set realistic targets, supporting them in a proactive and timely fashion. This can make all the difference between a healthy balance sheet and having to put their growth plans on the back burner.

Identifying funding opportunities to finance this growth

There’s a huge range of start-up funding options in the UK, even in the face of the COVID-19 crisis. From crowdfunding to tax breaks and EIS, angel investors to R&D grants, the start-up funding landscape can be complex, even for the most clued-up of business accountants.

By having an awareness of what kinds of funding options there are available for growing start-ups and SMEs, you can at the very least point your clients in the right direction. One of the most valuable types of research and development funding - R&D Tax Credits - is still an option that many business accountants haven’t heard of.

How R&D Tax Credits work

The government has long looked to encourage business growth and innovation via its R&D Tax Credits incentive. Essentially the scheme works by giving UK companies a portion of their Corporation Tax back to reflect their innovative research and development activities. Even companies that have filed a loss can benefit, instead receiving the benefit in lump sum cash instalments.

The types of projects and costs that be claimed against are many and varied. All companies based in the UK can be eligible, from the smallest of SMEs to the largest of corporate entities.

What would make your clients’ company eligible?

The essential thing here is that the company:

  • Has undertaken a project that makes some advancement in science and/or technology in their field
  • Spent money on that project
  • Had no idea if the project would be a success or not from the outset

It’s worth pointing out here too that even if the project ultimately failed, R&D Tax Credits can still be applied for in most circumstances. This is because it’s all about the ‘journey of discovery’ and not so much the end result.

Typically we’re talking about projects where the company has created a brand new product, process or service from scratch, or appreciably upgraded an existing one.

How much can my client claim?

This depends on a number of factors, and we can work with you to tease out which ones apply to your client. But broadly speaking your client will need to claim under one of two branches of the scheme (the SME branch and RDEC). Which one they use will be affected by the size of the company and whether it has previously received state aid. Again, we can advise you on this.

However, the fact is that R&D Tax Credits are generous. SMEs can claim as much as 33 pence for every £1 spend on the R&D, with costs like staff salaries, materials, overheads, subcontractor payments, employment costs all claimable.

Why not find out more on our R&D Tax Credits page, and also take a look at our recent blog: 5 Excellent Reasons To Work With An R&D Tax Relief Consultancy.

How Myriad Associates and the Tax Cloud portal can help your clients secure a claim

At Myriad Associates we only work in the niche areas of R&D Tax Credits, R&D Grants, R&D Capital Allowances and Video Games Tax Relief. This makes us experts in the field, working alongside companies and business accountants in achieving the essential funding for growth.

The Tax Cloud portal for accountants allow you to devise a high quality R&D Tax Credits application on your clients’ behalf, identifying eligible expenditure, calculating their relief and providing support.

By working alongside us, you know you’re offering the most comprehensive service to your clients. So why not call us today on 0207 118 6045 or send us a message and see what we can do.