Tips to Reduce Audit Risk With a Research and Development Tax Credit Claim
Small and medium enterprise and large enterprise seek to claim the tax credit for the research and development, it is a claim that can give the enterprise more funds to use in different ways within the enterprise. The enterprise can use the money to fund more in research undertaking, the enterprise can use the money for more enterprise development among others. The company needs to be aware of some tips that can help the enterprise maximize on the research and development tax claim. This article is going to talk about the tips the company should have in mind for the company to reduce audit risk on tax claim. Learn more here at https://granttree.co.uk/r-d-tax-credits-guide/
The company should make use of the expert of the research and development tax credit claim, this is the first step the company should take in realizing the maximum payout of the tax credit. The tax claim expert will first analyze if the company is eligible for the claim if it is not then he or she will guide you on the thing to do to make sure you become eligible for research and development tax credit claim. The expert will also draft and prepare the tax credit claim on behalf of the enterprise, therefore presenting a claim which is well detailed and error free.
To reduce the risk, make sure the company is a small and medium enterprise. The tax credit claim favors more when the enterprise is a medium or small enterprise, the enterprise that makes less than 80 million annually is considered a small or medium enterprise by the regulators, thus make sure the company’s turn over fall in this range when claiming for the research and development tax claim. The company should also no have more than 500 hundreds employees, the audit team will give a higher percentage of the claim if the company has less than 500 hundred employees. Get to know more from GrantTree.
The company should restructure what meet the requirements of the research, the research should be eligible or it should be categorized as qualified research. The audit team first get to know the kind of research you are involved in, if the research does not fall in the category of eligible research then the research and development tax credit claim will not go through. Eligible research should have permitted purpose if the purpose of the research is not allowed then the company cannot qualify for the R&D tax credit claim.