Whilst many Companies who incur costs on software development are developing software to sell, others just needed to have bespoke software developed to enable their various systems and equipment to run efficiently, or even to enable their wider R&D projects to be progressed.
These companies may well be able to claim R&D tax reliefs on the costs of this software development and in doing so obtain tax savings of around £25 for every £100 they have spent on doing so.
Broadly, R&D tax reliefs may be available on the following types of activities:
- Developing software to allow new equipment to function better
- Developing software to integrate various pieces of equipment and hardware efficiently
- Bespoke ERP, stock management and CRM systems
- Bespoke booking systems and customer interfaces
Set out below are some specific examples of the kind of software development activities that our Radius team have helped businesses claim R&D tax reliefs for.
Software Development Companies
- Development of digital asset management software
- Development of software to help educational establishments better organise themselves
- Development of software used in the recruitment industry to identify candidates
Manufacturers
- Development of apps to control heating systems
- Development of system integration software by a manufacturing company to completely redesign and improve the operation of their machines in terms of speed, accuracy and safety
- Interaction of software and hardware to develop new transport control systems
- Development of bespoke internal software to control all aspects of a customer’s order, including providing certification of type of product supplied
Service Companies
- Creation of bespoke integrated internal CRM and external customer portal to plan, track and process all interaction with customers and regulatory bodies
- Sophisticated software that manages surveys and collation of resulting data
Hopefully you can see from the above examples that you don’t have to be Google or Apple to claim R&D tax reliefs on software development costs. If you would like to discuss how this might be relevant to your company, please get in touch to arrange your free consultation or download our Guide to making R&D Claims on Software Development costs
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Scott Burkinshaw
Scott is Tax Partner at Shorts, specialising in providing strategic corporate and personal tax advice.
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