Claiming R&D Tax Credits for Long Term Projects

Discover how HMRC supports great innovations with R&D tax relief for long term projects. Get our R&D tax credit eligibility guide, understand how to manage multiple claims, how to keep track of the documentation process and how you can claim R&D tax credits alongside other tax incentives.

One of the biggest misconceptions about R&D tax credits is that it exists to support small advancements. With intricate planning however, HM Revenue & Customs allows businesses to make multiple claims on a single research and development project, so long as investment and progress have been made across various accounting periods.?

To help you with this intricate planning process, we’re taking a dive into R&D tax relief for long term projects.?

Can you claim R&D relief for long term projects?

To answer in short, yes, you can claim R&D tax credits for long term projects.?

HMRC understands that advancement doesn’t happen overnight, and that complex innovations can span the course of years. With this in mind, they ensure that long term projects are able to benefit from the highly sought after R&D tax relief for the entirety of a research and development project - so long as it meets the eligibility criteria of course.

4 eligibility criteria for long term projects

In order to help you establish whether or not your long term project qualifies for R&D tax credits, we’ve compiled this easy to follow guide.?

If you can confidently say that your research and development project aligns with each of these criteria, then you likely have a valid R&D claim.?

Managing R&D claims for long term projects

When it comes to claiming R&D tax credits for long term projects, it can be easy to make mistakes. Whether it’s misunderstanding the intricacies of the documentation process or it’s failure to keep up to date with legislative changes, there are many things that can result in a rejected claim.?

So here is what we recommend you do, to ensure that your claim is compliant with HMRC policy:

• Keep accurate records throughout the entire project
• Regularly review R&D policy and legislation
• Consult with R&D tax credit professionals

By developing an insight into how the R&D tax system works, collaborating with an R&D tax credit specialist is made easier, as you’ll quickly understand each step of their process.?

How documentation differs for long term projects

Considering the fact that you’re planning to make various claims for a single project, your documentation is placed under the microscope of HMRC. Not only does this compel you to ensure that your documents are accurate, but it requires that you pay specific attention to the costs you’re claiming in each accounting period.?

We recommend that you follow these steps:

1. Set deadlines that align with your accounting period
2. Gather and organise documents on a monthly basis?
3. Keep notes on progress of your project at every step

By following these steps, you’ll be able to easily identify and present the following to HMRC:

• Monetary investment into the project within each accounting period
• Technical progress made across each accounting period

Being able to keep track of these things is important, as they contribute to your technical report and your total qualifying expenditure for each claim that you make in relation to your long term project.?

What happens if you’ve received other tax incentives??

If you’ve received other tax incentives either for your research and development or elsewhere in your business, you may still be eligible for R&D tax credits. This is because in some cases, R&D tax credit relief can be combined with other incentives (such as government grants and subsidies).?

If your business has received other tax incentives, here’s what you need to keep in mind:

• In the case of grant funded projects, some businesses may need to shift schemes in order to align with eligibility criteria
• Patent Box Regime and R&D tax relief can be combined to offer a greater tax relief on one project, but the same expenses cannot be claimed for both

Working with Alexander Clifford to maximise your R&D claims

Here at Alexander Clifford, our expert consultants are dedicated to supporting clients throughout the longevity of their research and development projects. This dedication has allowed us to compile and submit upwards of 2,400 claims on behalf of our clients.

Our expertise on HMRC legislation and policy ensures that businesses like yours get the greatest service, as each claim adheres to the strict HMRC policies put in place to protect the tax incentive.?

This is what makes Alexander Clifford your trusted choice for R&D tax credits.

Click here to arrange a consultation with one of our specialists.