SMEs Still Waiting... For Research and Development Tax Relief! - CPA

SMEs Still Waiting… For Research and Development Tax Relief!

19th January 2018.

It has been revealed that the Treasury owes UK SMEs as much as £84 billion in unclaimed Research and Development tax relief (R&D). This means that a majority of the 3.5 million SMEs trading in the UK have been denied the relief with which to further aid the development of their businesses. Small firms already struggle to compete with the outreach of larger firms, and by not laying out the terms of this relief many innovative decisions have gone overlooked and unrewarded. The Credit Protection Association has seen firsthand the struggle of local small firms and the attention that they pay to develop their business. In the light of the Carillion disaster, the Government needs to concentrate all its attention on bringing small firms back from the brink, and providing with all the tools they need to succeed.

Specialist tax relief firm Catax has found that 57 percent of SMEs have been eligible for research and development tax relief, but due to the tax break being “so poorly advertised” only 1 percent of those covered under the policy had ever claimed.

The average claim for relief came to around £43,000 and could be backdated up to three years.

Mark Tighe, chief executive officer of Catax insists that the Treasury needs to explain to firms what counts as Research and Development.

“Most don’t realise it’s not just a new jet engine, but a new beer, a piece of software, an engineering process or even a new innovative dish at a restaurant,” Mr Tighe added.

Affording complete attention to developing your business can be tricky, particularly if you currently afford all your attention to keeping your business from insolvency. In the wake of Carillion’s collapse, most business concerns have centred on avoiding a complete financial crisis. However there are still small firms who want to focus on their development, and they should be rewarded. Innovating your business through technology or equipment is something that requires funding and hard work. It is absolutely disappointing that the Government has ignored this R&D tax relief and CPA supports every attempt to highlight this negligence.

In the meantime, however, CPA can also aid your business’ ambitions. If you need funding, we can free up your cash flow through our dedicated debt recovery service. We can clear your business of late payers and non-payers and advise you on any repeat offenders. If you are in need of help or advice, contact us on the details below!

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

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