BUSINESS ADVISERS KHAN THORNTON’S ADVICE TO MOTOR TRADE ABOUT R&D TAX RELIEF
Business advisers Khan Thornton, who specialise in supporting the motor trade (whether new and used car dealers, specialists or restorers) on accountancy and business development matters, warn of the difficulty of identifying R&D tax relief when applied to automotive firms.
“Whether a business invests in R&D through capital or revenue, R&D tax relief is rarely a straightforward concept; depending on the business, such investment can take different forms and have different objectives,” explains Principal Dino Khan. “Tax relief is also higher on revenue expenditure than on capital, which makes seeking support from business advisers such as Khan Thornton ideal, as our areas of expertise are more focused than those of generic accountants.”
Investing in new systems or exploring new avenues in technological fields are only a few of the examples which are labelled as R&D; yet, the great majority of businesses are not aware that tax relief is available, or that its availability extends to numerous fields, from manufacturing to engineering, IT and software development. Many specialists, for example, develop their own branded parts (brakes, aftermarket kits, motorsport upgrades). Such activities may fall under R&D’s remit.
Focused on the motor trade, Khan Thornton are able to undertake a comprehensive assessment of a dealer or specialist’s whole business. This helps identifying areas which would not seem eligible straightaway.
HMRC are actively encouraging businesses to explore R&D as a way to grow and expand, but only experts may be able to spot opportunities where none may originally be seen. For example practical applications such as integrating new technology with existing systems or process alterations aimed at reducing waste or achieving cost reduction may fall under the radar, yet qualify for a refund.
Claims can be backdated up to two years, funds are delivered within 6/8 weeks from HMRC acceptance of successful claims, and benefits apply to both profitable taxpaying and loss making firms.
Khan Thornton have been able to secure between £28k and £200k tax refunds for their clients in the last two years, by identifying activities within the business which counted as R&D.