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What Construction R&D Tax Relief Means for You

If you've developed something new or improved on existing products, methods or materials, the R&D tax relief scheme is there to support and reward you. That's why there's so much on offer for qualifying projects, such as:

  • An extra 130% deduction on SME R&D costs.
  • A tax credit cash payment to help you cover urgent costs.
  • Larger companies can claim a taxable benefit worth 12% of their qualifying R&D expenditure through the RDEC scheme.
  • Even if your R&D doesn’t go to plan, your claim remains valid.

Why do R&D Tax Credits matter?

R&D Tax Relief goes so much further than most businesses realise. As little as 3% of R&D claims come out of the building trade each year, and far too many of the sector’s qualifying costs, projects and activities are consistently overlooked as “just day-to-day business” in an industry that thrives on innovation.

What if my company doesn’t have a “research and development” programme?

The stereotypical image of R&D belonging firmly in the world of lab coats and microscopes is holding many firms back at a time when a real surge in innovation is needed. With the long shadow of an uncertain Brexit and a looming skills shortage to contend with, it’s more critical than ever for construction firms to get the rewards their innovations earn them.

What’s more, the UK government is actively trying to encourage them to make their claims. With an average R&D SME claim being worth £63,000, we’re talking about the single largest incentive scheme of its kind – and forward-thinking businesses throughout the UK are still missing out.

The range of costs and activities that count as R&D is a lot broader than you might think, and your project doesn't even have to be a success to qualify. Qualifying for R&D tax relief simply means that you can demonstrate:

  • It took expertise and “brain power” to get it done.
  • You’re tackling obstacles in new ways.
  • You’re finding easier, safer or "greener" ways to work.
  • You’ve made creative or better use of existing technologies.
  • There was no obvious solution already.
  • Your activity results in an advance in science or technology.
  • Your competitors would like to take advantage of it if they could.

Examples of qualifying activity

  • Overcoming system uncertainty may be necessary where older buildings have been refurbished with systems of varying ages. Integrating newer technology can be a challenge, while meeting the demands of sustainability and restoration. Juggling the requirements for BREEAM status can take significant innovation when you’re working to maintain the character and “essence” of a building.
  • Managing challenging ground conditions through innovation, such as issues with piling or foundations, perhaps requiring dealing with unidentified contamination. Effective solutions may not always be readily identifiable, so businesses innovate to minimise delays, budget overruns and other problems.
  • Recreating old techniques and developing new ones, particularly when dealing with older structures or newer “green” regulations. Certain techniques may have fallen out of use, or may no longer be appropriate. The growing skills shortage is obviously a real concern here. Finding newer, more effective or efficient methods to achieve the required result can mean a lot of innovative R&D work.
  • Bespoke designs for one-off builds. Bespoke projects can be tough to plan around. Not every obstacle or eventuality can be predicted. A lot of work needs to be done at the design stage, naturally, and where there’s no existing blueprint to work from the complications and challenges are heightened. This is exactly the kind of environment that calls for innovative thinking and solutions.

Why work with RIFT?

  • We're specialists in hunting down every qualifying cost and activity in your business.
  • We speak HMRC's language and have an outstanding success rate.
  • We understand the rules and can navigate every factor impacting your claim, from grants and subsidies through to subcontracted R&D and innovation in connected enterprises. Whatever your circumstances, we can advise you accordingly.
  • We're here to stay. We're a family-owned business established in 1999 and employing over 180 people.

Why we are working with the Constructing Excellence?

Funded and governed nationally by its corporate members, Constructing Excellence has built itself into an ideal platform for driving debate and stimulating change across the entire construction sector. Drawing in the most influential minds from every link of the supply chain, the organisation powerfully promotes its shared vision of an industry thriving through innovation and collaboration.

As the UK’s leading light in R&D Tax Credits claims, RIFT has already claimed back over £14m for our R&D Tax Relief clients. When you’re building an R&D claim from the ground up, RIFT is the perfect tool for the job. Partnering with Constructing Excellence means we’ll be able to get the message about R&D Tax Credits out more widely than ever – putting valuable tax relief firmly within the UK’s construction sector’s reach.

In construction, every project presents its own, unique challenges – and with them, the opportunity to innovate. That’s what the R&D Tax Credits scheme is designed to recognise and reward. RIFT’s partnership with Constructing Excellence gives us the voice and the tools we both need to ensure UK construction always gets the credit it deserves.