The R&D tax credit scheme was introduced to the UK in 2000 and has seen a steady growth in claimants. In 2001-02 there were less than 2000 claimants, whereas the latest figures for 2019-20 show 82,950 funded through R&D tax credits.
Alongside this growth, there has been an evolution in how companies claim R&D tax credits. Initially, accountants handled R&D claims; however, it soon became evident that a level of expertise was required to provide appropriate guidance on the R&D claims process. This demand was met with the introduction of specialist but traditional R&D advisors, typically as a spin-off unit from an accountancy practice.
As technology has advanced over the years, businesses across the board have incorporated technology to improve efficiency and outcomes. The R&D claims process is no different, with EmpowerRD entering the market to offer the next evolution of R&D claims. By combining an intelligent, online claims platform with a team of specialist R&D claims advisors, businesses can experience a more efficient claims process and a better outcome for their R&D credit.
In this article, we outline how EmpowerRD improves the R&D claims process and delivers a better service than traditional R&D claims advisors.
1. You’ll receive your credit quicker
Traditionally, businesses needed to wait 4-5 months to receive their R&D credit after kicking off their claim. At EmpowerRD, most of our claims are completed within 2 weeks, and the credit is typically received in 6 weeks. We’ve achieved that through a few innovations and service improvements which we outline below.
Our intelligent online platform speeds up the process of creating your claim, which results in credit being received more timely. Our platform enables your technical team to capture the critical information in a way that is compliant and optimised with the scheme rules. We use this information to build your narratives into the claim report and write up the overview of the claim.
This approach varies from traditional advisors who employ expensive domain experts to write the narratives by interviewing your team. This can drain your team’s time and cost much more than EmpowerRD’s method.
We sit on HMRC’s R&D Consultative Committee and are one of four trusted advisors setting industry standards with the Chartered Institute of Taxation. HMRC receives thousands of claims each month; however, being a recognised advisor with a 100% success rate ensures our claims are swiftly processed. We also have a robust, standardised procedure for building our claims. This results in quick turnarounds for our claims once they’re submitted.
We proudly track how quickly it takes our clients to complete our process. Our fastest claimant completed their claim and received their funds in 6 days and 2 hours. Most of our claimants submit their claim in under a week.
2. You’ll get the most credit possible
It’s essential to have confidence that your provider will maximise the credit you receive from HMRC. At EmpowerRD, we’ve built a process that ensures our clients receive the maximum credit available from their claim. In some cases, where we see that a client’s previous advisor has mishandled their past claims, we’ll retrospectively assess a client’s old claims. By doing this, we helped Bloom and Wild increase the credit they received from an old claim by 290%. Below we describe the ways in which we ensure you get the most credit available.
At EmpowerRD, we have a talented and experienced claims team who know how to get the most from your claim, no matter how intricate it is. Our team includes ex-HMRC inspectors and experienced R&D tax advisors who’ve submitted claims for businesses ranging from small startups to FTSE100 companies.
We use our platform to benchmark our claims against others within our portfolio. This is done at the overall claim level and at the level of the cost components within the claim. This helps our team ensure that they’re claiming the right amount for businesses in that sector and that the claim will be successful when submitted. By not structuring their claims in a platform, traditional advisors cannot benchmark claims with this data. Traditional advisors don’t have access to data like this and aren’t able to back up.
We’re incentivised to maximise the amount you receive back from HMRC because we charge a % fee. Many traditional advisors, coming from accountancy practices, will charge you a flat fee. By doing so, they no longer have an incentive to maximise your claim. Instead, they are incentivised to keep your claim low because HMRC are less likely to launch an enquiry. Ashley Friedlein, CEO of GUILD said, “EmpowerRD challenged us on our claim to make sure we’re getting the details right – maximising the value of funds, and avoiding the risk of enquiry”.
3. You can track the progress of your claim
Building your claim can take up a lot of company time, whether it’s assigning tasks to the relevant members of your team, keeping up to date with which sections are complete or knowing when you’ll receive your credit. Building a claim often requires input from multiple parties. You may need input from the product, finance, HR, engineering and leadership teams within your organisation. In addition to this, you might coordinate the claim with your accountant as well as multiple contacts at the R&D claims advisor. This was one of the key reasons that we brought technology into the process. EmpowerRD’s intelligent platform is designed to help you keep track of the progress of your claim while also working collaboratively with all the contributors. This is one of the key reasons why it takes longer to submit a claim with traditional advisors.
We designed our platform to improve the claims process and aid coordination for your business. Each stakeholder receives a login with customisable permissions, meaning you can assign tasks to the relevant members of your team, making the completion of sections seamless and efficient.
The coordinator can also track the progress of the claim using the activity dashboard. A percentage dial will increase as the tasks are completed by your team, helping you understand what is left to do and how long it might take.
EmpowerRD is constantly in touch with HMRC, which means we can keep you informed of any key updates that might affect your claim. We publish the HMRC payments timetable to our website weekly to help you understand when to expect your credit.
4. EmpowerRD will charge you less
One of the other major core reasons we use technology is that it makes the process significantly more efficient for us as an advisor. Because of this efficiency, we can charge much less to our clients than traditional advisors. The EmpowerRD platform reduces the amount of menial tasks required of our advisors. Traditional advisors spend a lot of time compiling documents, and co-ordinating the claim amongst different teams. Our platform incorporates these tasks, enabling us to charge less and focus on the more specialist tasks, like maximising your claim.
The use of our intelligent online claims platform means we can charge 5% or less for SME claims, and 10% for RDEC claims and our price does not change in the case of an enquiry or any other complications.
What’s more, our team provides an end-to-end service. We ensure that you claim the full value of credit available to you while minimising the impact on your team. Our R&D tax credit advisors help you identify all the relevant costs, work with your tech team to write the narratives, and calculate and submit your claim, all for our percentage price. Jack Huang, CEO of Truly commented, “not only did EmpowerRD save us money, the level of expertise and quality of guidance was actually much higher than with our accountant.”.
There are numerous unscrupulous traditional providers out there who will exploit the lack of market awareness of claimants and charge 15% or more. We’ve seen claimants pay as much as 40% for their claim.
5. You don’t need to worry about the small print
Unfortunately, some traditional R&D tax credit advisors include the more controversial aspects of their service deep within the small print of their contracts. As many claimants will be accessing the scheme for the first time, it can be difficult to understand the impact of these clauses. The most common issues are lock-in multiple-year contracts, hidden claim reports and enquiry defense charges.
- Do lock-in contracts
- Stop you from viewing your own claim report
- Charge you extra to defend an enquiry
As a responsible R&D tax credit advisor, we allow you to move providers after your first claim if that’s what you want. We will never lock you into a multiple-year contract. Many first-time claimants, unaware of the market rates, will sign up to multiple-year contracts at high price rates. Knowing that the claimant will likely leave after their lock-in period, the provider has no incentive to deliver a quality service.
At EmpowerRD we always allow our claimants to access and keep their claim reports. The claim report is an important record for your own tax purposes. It could be pivotal in a future enquiry on any of your tax matters with HMRC. Traditional providers who don’t allow you to see your own claim report may do this because they don’t want to expose the poor quality of their work, but it also affects your ability to move providers.
We also offer the additional service of handling any HMRC enquiries that come your way for no extra charge. We believe in our platform and our ability to produce strong claims but also understand that enquiries happen. We always want to put our best foot forward when building your claim and are dedicated to defending it so that you get the best outcome possible. Enquiries can take a long time to resolve, some taking over a year to resolve. As a result, traditional providers can sometimes charge astronomical sums to help you through them. Because we defend all of our own enquiries, we are also proudly able to say that not one of our claims has seen a reduction in value from HMRC.