R&D tax credits offer valuable financial support to companies developing new products and systems to improve their business – but you don’t have to be doing rocket science to have a valid claim.
Many businesses rely on legacy software that is bespoke to their organisation or has been adapted extensively to meet longstanding business needs. Likewise, in many instances the addition or enhancement of critical components such as data analytics and trading platforms often require extensive development – often costing more than the new software or other component did.
Where the costs arise
The interface between legacy systems and your new software or systems may raise numerous compatibility issues – and require more than a few simple application programming interfaces (APIs) to get things working at optimum efficiency. In our experience, integrations are almost never straightforward, and generally require the development of middleware solutions in order to optimise their new processes and solutions. This often involves more than a few iterations of testing, experiments or trial and error, sometimes even leading to significant extensions to the duration of the project.
In many cases, there can be technological uncertainties to overcome to make things work efficiently – for example, linking up software that has never been integrated into your type of system before. Whenever your project has to resolve a technological uncertainty, it is likely that some element of the work involved will qualify for R&D tax relief.
Have you claimed for your integration projects?
Despite the extensive effort that integration projects require, we have seen multiple instances where large businesses haven’t recognised that their projects are just as entitled to financial support through R&D tax relief as projects carried out by their dedicated R&D teams. But BDO can help - our software engineers have helped numerous companies claim R&D relief for their software activities that were centred on further enhancing a proprietary third-party system.
Our team guided a company to claim R&D for their Financial Services platform which focused on delivering high end data analytics and trading capabilities to customers on a global scale. The main challenges included the development of a middleware layer which could bridge the legacy systems with third party components. BDO helped the company identify key aspects of their R&D journey, focusing on the enhancement of their e-trading broker platform by enabling risk clearance capabilities. This included the development of an asynchronous communication protocol which was seamlessly integrated with the legacy platform.
Another successful project helped a company access R&D tax credits for the integration of a third-party business analytics service with their proprietary technological platform to support investments and real time transaction updates. We identified that the extension of the existing proprietary capabilities through the development of a middleware layer leveraging several advanced technologies to offer a seamless integration and additional capabilities was qualifying R&D.
Specialist support to claim funding through R&D tax credits
BDO’s R&D tax specialists have supported businesses across a wide range of sectors to make claims related to integration projects by helping them identify qualifying R&D work undertaken as part of their overall solution. We can guide your team to compile a robust R&D claim that makes sure that you claim for all relevant costs and have greater assurance on submission.
If you have an integration project underway, or are planning a major new software or systems purchase, please get in touch for help and advice.
R&D Benchmarking Tool
There have been fundamental rules changes to R&D tax relief qualification and claim reporting requirements. BDO has an advanced mobile ready solution available to benchmark your R&D claim benefit against companies of a similar size and the industry sector. For more information visit our BDO store.
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