March Year End: Fail to Prepare, Prepare to Fail

March 31 year-end: use it or lose it.

As a business with a March year-end, you’ll want to make sure you use all the tax reliefs available to you before your current tax year ends on 31 March 2024. If you miss the deadline to make a claim, you lose your ability to claim for previous years.

For example: R&D claims for accounting periods ended 31 March 2022 must be lodged with HMRC before 31 March 2024, or you will lose the ability to claim for that period.

Fail to prepare, prepare to fail.

With the landscape of R&D tax relief undergoing substantial changes, it’s crucial that you stay informed and prepared, as these are set to impact how you plan and claim R&D tax credits.

Visiativ is here to help you remain informed and compliant. Let’s dive into the changes and understand their implications for your business.

R&D tax relief changes – everything you need to know

 1 April 2023

Change

• SME rate reduced from 130% to 86%
• SME cash out rate reduced from 14.5% to 10%
• New R&D intensive rate equaling 27% tax benefit
• RDEC increased from 13% to 20%

Impact

• Potential reduction in claim size.
• Requirement to establish eligibility for new R&D intensive rate.
• Planning required around use of tax benefit against future tax position.

8 August 2023

Change

• Introduction of AIF – mandatory compliance form completion

Impact

• Increased workload for all claimants.
• Claims rejected if not completed.

1 April 2024

Change

• Exclusion of overseas expenditure

Impact

• Potential reduction to claim size and therefore planning required.

Accounting Periods from 1 April 2024

Change:

• Merger of SME and RDEC schemes
• Increase to R&D intensive threshold eligibility
• Further proposed reduction to SME rate

Impact

• New rules to learn and additional complexity around claim profiling

We can help.

Don’t miss your March year-end deadline! Get in touch with us now to ensure your deadline can still be met, and you don’t miss out on a significant cash windfall.

Once you’ve got us on board, we can help you set up the processes you need to get your company prepared for the increased level of complexity in claiming R&D tax relief following the recent changes.

Just like we did for our clients at Peerless Plastics & Coatings: “Our accountants told us the rules for claiming R&D tax relief were changing and recommended we partner with VISIATIV on our upcoming R&D tax claims. I had always managed our R&D tax relief claims myself; however, given HMRC’s increased scrutiny, I recognised the need for expert assistance. Bringing in VISIATIV offered reassurance that we had support ready should any challenges arise.” Peter Llewellyn-Stamp, Director

If you have any questions relating to R&D tax relief or wish to discuss the implications of recent changes to the R&D tax relief scheme on your own claims, please get in touch with VISIATIV, and a representative will get back to you to discuss your unique needs and explain how we can assist.