Written by Sam Giles, Tax Assistant
This article nearly started with a horribly overused cliché – ‘no two days are the same’.
Although this isn’t quite the case, it’s impossible to sum up a single day working in R&D as most, if not all, claims are not completed in a day. I don’t think a day in R&D therefore paints a very good picture. Instead, a better representation is to walk through a whole R&D claim as a tax assistant at Claritas.
We are fortunate in the firm to have a wide range of clients within the R&D department – these range from automotive patternmakers to companies assisting space exploration missions. While I may not be able to get my hands on any outer space gadgets as a tax consultant, being involved in R&D tax claims allows me to get fairly close!
Our methodology at Claritas is simple; to produce a comprehensive claim we aim to understand our client’s work from the ground up. I’ll often head out to client sites with a couple of members of the team including our Tax Director David Nolan to have a first-hand look around the company. As I have a background in Aeronautical Engineering, this is especially interesting when we have the fortune to visit companies performing scaled fluid dynamic simulations for structures, such as new dams or waterways!
We will then sit down with the client’s technical directors or project leads to discuss the overall qualifying criteria behind what is and isn’t R&D. At this point we open the floor to them and aim to explore any projects that they think may possibly fall under R&D. Often technical specialists will not realise that what they are doing is research and development because they frequently see it as a part of their day job – which will often be to advance the technology they’re working with.
Once the R&D projects have been established, we then begin digging with initial investigations such as establishing who was working on the project, what costs were involved and whether anything has been subcontracted out. Having worked in R&D for a few years, I’ll often get to lead these discussions, getting first-hand experience at trying to understand the intricacies of the company we’re dealing with.
After we’ve found what projects will qualify, we then send over a request for all the financial information needed to substantiate the claim value. Once we’ve pulled together consumable, labour and subcontract costs we arrive at the final claim figures.
We’ll usually accompany these figures with a supporting document that justifies how this has been arrived at and highlights how and why our client qualifies for R&D relief.
From start to finish I’m lucky to have first-hand involvement in this process and have done since I first started at Claritas.
Although I initially disagreed with the phrase ‘no two days are the same’, I would say with certainty that no two claims are the same. As such, with every client we take on for R&D there is always something to learn which keeps things fresh and exciting!
