Documentation Management Consulting
There has for a long time been an ongoing problem with the government’s tax credit scheme, the R&D tax credit, which is designed to reward research and development. Many companies in the US do not think that they are eligible to receive it. This has resulted in many companies not even making an application, missing out on important tax breaks that could be supporting them financially.
Your company is more likely to receive it than you think!
The IRS definitions and guidelines provided by the regulations covering the R&D tax credit are more flexible than many companies expect them to be. There is a common misconception that a company has to be a large corporate firm, with cutting edge technology and huge laboratories in order to obtain these tax benefits.
This is entirely not the case, and any qualified, professional tax advisor will inform you that in all likelihood, your company at some point becomes eligible for the R&D tax credit through the activities that it performs on a regular basis. The R&D tax credit is after all designed to encourage and reward industry for innovation and development. There is no limit on the type of industry that can be eligible and this is a credit that is just as applicable to public sector companies as it is to the private companies who currently benefit from it a great deal.
It is all in the preparation:
Because of the nature of the documentation which is required by the IRS when claims are made for this tax credit, it is vital that there is an ongoing company strategy in place to make sure that it is provided. This means utilizing your company resources and hoping that you have the in-house knowledge to do it right or having the expertise of specialist tax advisors to hand. The latter option can make the whole claims process less time consuming and therefore less costly to the company.
Quick Resolution of Issues:
Companies in receipt of the R&D tax credit tend to find that the problems arise when there is a lack of understanding as to the specific requirements to gain access to these tax credits and also to keep them. Having the right support is vital to ensure that companies gain access to the finances which they need and therefore misunderstanding the documentary requirements or not having the processes in place to ensure that the documentation is available can be costly to your business.
A professional tax assessment team can advise you on what you need in place to ensure that all claims are easily dealt with and that the payments can be maintained if your company is audited. Knowledge is power, after all.
If you need more information or have any questions regarding your company’s eligibility for the R&D tax credit then please complete our Contact Form and one of our experts will be happy to answer your queries.