How to remotely prepare R&D tax claims

The Covid-19 pandemic has led to many businesses changing the way they operate. Of all of these changes, remote working has been by far the biggest shift affecting both workers and their managers in equal measure. Indeed, your client may not have been in their usual office for over a year and a half at this point. With few face-to-face meetings, and potentially being off-site for the majority of the project’s duration, you may be unsure of the best way to prepare an R&D tax credit claim. The good news is, with a bit of planning, it can all be done remotely. 

What you need for an R&D tax credit claim

Whether you’re preparing your client’s claim remotely or not, the process of applying for R&D tax credits remains the same. 

  • Choose eligible R&D projects and identify qualifying expenditures: 

Talk through all R&D undertaken during the client’s financial year and identify the projects that fit HMRC guidelines to include in their R&D tax credit claim, along with the qualifying costs in each. Accurate record-keeping on the part of your client will make this step very straightforward however HMRC also understands that timesheets may not be used by many SMEs so accurate estimations on time are acceptable. 

There are a few categories of acceptable qualifying costs as defined by HMRC’s CIRD. Read about how HMRC defines qualifying R&D work.

  • Prepare a financial report: Creating a financial report involves collating and categorizing all your client’s R&D costs into three main areas: Employee costs, Subcontractor costs, and consumables.

If your client is eligible to use the SME scheme they increase their qualifying expenditure by a further 130%. Read about the other ways R&D tax credits are a helping hand for small businesses.

  • Prepare a technical report: This supporting documentation outlines how each of your client’s projects meets HMRC’s definition of R&D. This step goes a long way in ensuring your client’s claim is successful and reduces the growing risk of a query.
  • Fill out the CT600L: Completing this form is the final thing to do before sending off your client’s claim. It involves entering your client’s financial values, which were determined in the financial report, into the correct boxes.

How to prepare your client’s R&D tax credit claim remotely

To gather the information needed for an R&D tax credit claim your client may have to involve their technical experts in your communications as they themselves may not have the details of specific R&D activities. These experts should be the people in positions that oversee R&D projects, such as technical supervisors and managers. Some of the communications may involve: 

  • Video calling

Due to the global pandemic, face-to-face meetings have become much less common. Platforms like Zoom, Microsoft Teams and Google Meet offer free-to-use options for making video calls. You may want to check beforehand to ensure a stable internet connection as a less reliable one may make the consultation frustrating for both parties. Video calls are especially useful when preparing an R&D tax credit claim remotely as your client can easily consult and include their relevant experts. One of the many features of video conferencing includes the option for screen sharing. 

  • Screen sharing

Preparing an R&D tax credit claim involves dealing with numerous figures and occasionally technical drawings or images. There may be questions regarding certain parts of a data set or how a figure was calculated. Screen sharing allows your client instant visibility and collaboration through presentation sharing. With greater interaction through screen sharing both parties can get answers quickly.

The benefits of preparing R&D tax credit claims early

Whether preparing an R&D tax credit claim in person or remotely it is best to get started early. 

The time involved in preparing R&D tax credit claims can put some clients off. However, increased’ demand by businesses for financial relief has put R&D tax credits in the spotlight. It is best practice to start the technical data gathering at the beginning of each financial year and do the financial calculations as soon as your client is close to filing their tax returns.

Recording the details of R&D work as it happens makes preparing a claim much simpler when it comes time to file.

Get help preparing your client’s R&D tax credit claim remotely with made.simplr

Luckily there is an easy to use software platform to help you gather all the supporting documentation as well as calculate your claim and create your financial and technical reports. made.simplr have been helping accountants to prepare hundreds of client’s R&D tax credit claims. The software makes both your and your client’s lives easier by allowing you to:

  • Manage claims online – plan your claim through our online platform. Set access parameters so your staff can work on different parts of the claim.
  • Integration with Xero – your claims are securely automated. No digging or manual entering to get the data you need.
  • Performance analytics – no matter the client or claim, we crunch the numbers to give you the bigger picture.

Find out how to better help your clients remotely by booking a demo today.

Eneko Igartua

Eneko Igartua is the Head of Operations at made.simplr. Originally a manufacturing engineer, he is an expert in R&D funding, having worked with R&D tax relief and grant funding from national and European sources. He is interested in helping accountancy firms expand their offering through software solutions.

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