Claiming tax relief within the agricultural sector has been minimal over the years. Less than 1% of companies claimed last year, but for those who did the average claim was £52,000 which I'm sure a lot of farms would appreciate right now.
Don't miss out on thousands in tax relief
- Thread starter InnovateFarm
- Start date
- Location
- Wales UK
Maybe no one making enough for tax and able to thus use available relief???
It's framed as tax relief but in reality what it means is any money you have spent on innovation or R&D projects can be claimed for and you will end up getting a payout from HMRC. It doesn't have to be taken off your tax bill at the end of the year, it is just a bulk payment into your business.
- Location
- Left in the middle of nowhere
I asked my accountant about it & apparently only limited companies can apply?
Limited companies and partnerships can apply if you are paying corporation tax. If your partnership is treating revenue as personal income and you just pay income tax then you aren't able to claim i'm afraid.
- Location
- Wales UK
- Location
- Somerset
R&D tax credits are a useful tool for reducing tax for companies and corporate partners, but not there for the traditional partnership structure of a lot of family farms.
The company needs to be trying to make 'a scientific or technical advance in the industry' and needs to be looking at something that could not be 'readily deduced by a competent professional in the field'. It also needs to be possible to attribute some costs to the work and demonstrate some degree of loss to the company.
It is possible for many companies to be working on the same area, particularly after legislation changes, and each company is able to make a claim for their costs.
Beware of the claims that it is free cash, it is a tax refund, so you did pay it to HMRC. Done regularly and in a timely manner, you would simply pay less tax rather than pay and reclaim. Also possible to 'sell' R&D losses to HMRC if no tax has been paid. Accountants should be speaking to you if you could be eligible, I know I am with the farming businesses I work with.
Beware of being promised huge payments, the claims ultimately are your responsibility, and need to be defensible in the event of an HMRC enquiry. Some of the R&D specialists are very aggressive in the claims, but others are good.
The company needs to be trying to make 'a scientific or technical advance in the industry' and needs to be looking at something that could not be 'readily deduced by a competent professional in the field'. It also needs to be possible to attribute some costs to the work and demonstrate some degree of loss to the company.
It is possible for many companies to be working on the same area, particularly after legislation changes, and each company is able to make a claim for their costs.
Beware of the claims that it is free cash, it is a tax refund, so you did pay it to HMRC. Done regularly and in a timely manner, you would simply pay less tax rather than pay and reclaim. Also possible to 'sell' R&D losses to HMRC if no tax has been paid. Accountants should be speaking to you if you could be eligible, I know I am with the farming businesses I work with.
Beware of being promised huge payments, the claims ultimately are your responsibility, and need to be defensible in the event of an HMRC enquiry. Some of the R&D specialists are very aggressive in the claims, but others are good.