This document discusses claiming R&D tax credits from HMRC and whether a manufacturing business truly understands the process. It notes that claiming R&D tax relief requires understanding both the R&D being conducted and HMRC's comprehensive guidelines. Many businesses understand their R&D work but struggle with HMRC's expectations, risking over-claiming and scrutiny or under-claiming and lost money. It emphasizes that HMRC's definition of R&D covers more than just laboratory work, and that failed attempts at advances can still qualify as R&D. It also stresses the importance of understanding the difference between a technological uncertainty versus unknown when claiming eligible projects. Specialist firms like Jumpstart understand both a business's R&D

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U N D E R S TA N D I N G R & D
CLAIMING FOR R&D TAX CREDITS
DO YOU REALLY
HAVE IT COVERED?
“
We were thrilled to realise
much of our work meets
the R&D criteria.
| STUART MCCALLUM
| DIRECTOR
| MCCALLUM BAGPIPES
100 %
Our team of highlyqualified technical
analysts is the largest
in the UK and to date
has helped more than
500 businesses with
a 100% success rate
for our applications.
Claiming for R&D tax relief is a complex business and one that requires
a broad range of knowledge, not only of the R&D being carried out,
but also of the very comprehensive guidelines set out by HMRC.
While most companies have the first part covered – a thorough
understanding of what they do – many find that the trickiest part
of the claim process is understanding just what HMRC expects from
them, resulting in two main issues - over claiming and being subjected
to inquiry or under claiming and losing out on money. So does your
manufacturing business have R&D tax relief claims covered? The
following questions should reveal the true answer....
Do you understand HMRC’s definition of R&D?
You might think of R&D as something that is only done by people in white coats in a
laboratory, but in fact the HMRC guidelines take a good few pages to define R&D for tax
purposes and it covers an awful lot more than just laboratories. If you are carrying out a
project that directly contributes to an overall advance in your company’s area of expertise
– whether that be manufacturing blinds, bagpipes, boilers and anything in between - then
you may well be doing what HMRC defines as R&D without even realising it. Don’t worry if
you’ve tried an advance and it has failed, just because something hasn’t worked it doesn’t
mean it is not R&D, an attempted advance that failed can be just as eligible as a successful
one.
“
You may well be doing what HMRC defines as R&D without even realising it.”
Do you know the difference between a technological uncertainty
and a technological unknown?
Arguably the most important distinction to understand in the claim process is that between
a technological unknown and a technological uncertainty. It doesn’t sound like much but, for
HMRC, the difference between an uncertainty and an unknown can be the difference between
an eligible and ineligible claim. A technological unknown is a problem that can be easily
solved using conventional methods whilst a technological uncertainty is what arises once
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“
We were so impressed
with Jumpstart, primarily
because they are the only
pro – active firm who
actually take the time to
visit their clients, actively
explain the process and
offer clarification to what
will be required our end.
We are now increasingly
more confident about
how the method works
and the nature of claim
eligibility.
U N D E R S TA N D I N G R & D
all of the conventional problem solving methods have been exhausted and it’s time to start
thinking outside the box. This is when R&D begins.
Do you know about all the other stuff you can and can’t claim for?
So, you understand what HMRC defines as R&D and have identified eligible projects with technological uncertainties in your company’s manufacturing work. Now what? Do you know
which costs to claim? What HMRC views as eligible expenditure and what it does not?
Whether or not you can claim for subcontracted work and how a grant might affect your
claim? It’s a minefield in which an understanding of HMRC’s guidelines is essential. That is
why so many companies are turning to R&D tax relief specialists like Jumpstart - you know
your projects and we know HMRC’s guidelines, which means as a team we can always ensure
the best possible claim!
| MIKE JARMEY
Quick check list
| DIRECTOR
| THE MAYFIELD GROUP
Ensure that technical staff understand the scheme.
2,500
The number of claims
successfully
submitted by
Jumpstart from 2008
to 2013.
Ensure you fully understand all the differences between an unknown and uncertainty.
Identify every eligible project - often, there are more than you think in manufacturing.
Ensure your submission is not over-claiming for areas that are not R&D.
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About Jumpstart
Jumpstart is a science and technology company that specialises in R&D tax relief. They are 100% focused on helping
companies make successful claims for HMRC’s R&D tax relief programme. Helping with all stages of the claim process,
they ensure that only optimised, accurate and compliant claims go before HMRC. The key to their success is that every
member of their delivery team has a first or postgraduate degree in an area of technology or science.
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T 0131 240 2900 F 0131 226 4506 E help inghand @jum p st ar t uk . co. uk
w w w . j u m p s t a r t u k . c o . u k
A H E L P I N G H A N D F O R M A N U FA C T U R E R S
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