The company is a large scale building firm who work mainly in the Hospitality sector. They had completed over 60 large scale projects and attempted to innovate on many internal projects in the tax year in question.
RSL came in and helped them to analyse their projects, identifying 3 they had undertaken which amounted to a tax saving of £45,000 in that year.
In the example the business has spent £180,000 in qualifying Research and Development Tax expenditure.
This expenditure is multiplied by 130% to give the enhanced expenditure amount of £234,000.
The enhanced expenditure is then subtracted off of the company's profit figure of £430,000. This leaves the company with a reduced profit level before tax of £196,000.
This reduces their Corporation Tax bill from £81,700 to £37,240, resulting in a total tax saving of £44,460.
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