No relief for Research and Development SME's
Article date: Fri, 25 Nov 2005 12:08 GMT
ISP UKFast has discovered that over 72% of its technology client base working in Research and Development is not receiving the tax credits available. What's more, 45% were not even aware they existed. With all of these companies in the Small business bracket, Lawrence Jones MD of UKFast believes it's time the government did more to encourage those who need the breaks.
Harper James conducted the studies for UKFast revealing that the Government is not setting a level playing field. Larger more established companies are enjoying the incentives, explains Jones. But the vast majority of small businesses that try for relief give up because they don't have the resources to follow a claim through.
When questioned, an Inland Revenue spokesman conceded that it is often hard to translate legislature into easy to read manuals for those who cannot afford the consultancy of a top level accountant.
Research & Development tax credits are a company tax relief that can either reduce a tax bill or, for some SME's, provide a cash sum. Mike Dugan of Bytecraft was not aware of the allowances and past experience led him to believe that applying for such credits would be a dreaded' prospect.
UKFast is a company founded on growth through Research and Development and Jones is calling for improvements to the system. It's ironic that the Government seeks to encourage innovation and yet the very people with the drive to push technological boundaries are unaware of such tax breaks or feel discouraged to apply for them.
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