Regardless of the financial overall health of your organization, there's normally the want to save somewhat dollars where feasible. Probably just about the most satisfying strategies to save slightly dollars is within the type of tax relief - either paying significantly less in taxes or receiving income back. You'll find schemes available which can assistance fintech organizations do just this but several are missing out. So how do you realize in case your firm is eligible?

Tiny company relief rate
One change that comes into force this April is the change to the modest organization relief price that was announced by then Chancellor George Osborne back within the 2016 Price range. This relief, generally known as the SBRR, was doubled from 50% to 100% last April.

Alongside the price becoming raised, the threshold was raised from £6000 to £15,000 for the lower price and from £18,000 to £51,000 for the standard price. The result of this may imply some six,000 little enterprises might be paying no tax and another 250,000 will see their tax bill reduce.

R&D Tax Credit
Possibly the biggest tax relief readily available to firms that are getting underutilised could be the Research and Development Tax Credit. This scheme was set up back in 2000 by the government to encourage research and development across the country by giving a substantial tax relief to qualifying project costs.

The HMRC R&D Tax Credit scheme currently has two tiers - tiny and medium enterprises (SMEs) and large businesses. For SMEs, the amount of credit they can receive for the work that they are doing is 230% from the costs. So, for every £100 spent on R&D that qualifies under the scheme, the company can claim back that £100 plus an additional £130.

SMEs are qualified as organizations with much less than 500 employees and an annual turnover of significantly less than £100 million or a balance sheet of much less than £86 million. Organizations that fall outside this definition are classed large providers and can claim up to 130% of qualifying costs, as long as they spend more than £10,000 a year on research and development.

Does your work qualify?
Numerous fintech companies think their work doesn’t qualify but the very nature of the ‘tech’ side with the business means they are potentially on the list of qualifying projects. Among the list of main criteria for qualifying projects is that they are in the area of either science or technology. This means the development of new technologies or the advancement of existing tech can both qualify under the scheme as long as they meet the other criteria.

The project does need to be in the area that the business enterprise operates in - so a fintech firm likely wouldn’t start working on a revolutionary new recipe organising software! But if the project is a clearly defined one particular with aims and processes and is in the area that the enterprise works in, then there is certainly a good chance that it can qualify. The people working on the project also have to be qualified for the task, not simply slotted in to fill out the numbers.

What can you claim for?
The other main question is what can companies claim for in regards to this R&D project? The main thing will be the cost of salary for any members of staff working on the project. If they work 50% of their time on the project and 50% of their time on something else, then only the half spent on the project would qualify. Under the same definition, you can claim for materials used within the project, power and other utilities consumed for the project and even the cost of software or hardware purchased solely for the purpose in the research project.

Why companies are missing out
On the surface, this might seem like a specialist tax relief that doesn’t really apply to a fintech enterprise and this is why numerous companies are missing out. Yet in the year 2013-14, there were over 16,000 claims under the scheme and the payments totalled some £800 million. So how do you realize in case your company can qualify?

One of several easiest strategies is to engage the services of a company such as Easy RnD to assess the research and development work your business is doing and see if it qualifies under the scheme. As experts within the field, the corporation can quickly look at what qualifies and what costs you can claim for, even processing the claim. A lot of of their clients receive a tax relief settlement in as small as six weeks.

You will need some basic information about the projects that might qualify under the scheme for them to carry out the claim. Questions such as ‘how do I find a business registration number’ can also be answered by them to assist you prepare for your claim. And within a short time, you can know if you are due the relief and can be saving funds for your organization.