Wouldn’t it be great to have a company who could provide accounting solutions that are as innovative as your ideas?
As specialists in accounting for tech startups, who pride ourselves on having expert knowledge to suit companies within their niche, we are clued up on tech-ups and the tax implications of setting up a business of this nature.
‘Startups. The newest companies that could change the world.’ – Tech Crunch
Why Tax Agility?
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Just like innovative tech start-ups and the visionaries behind them, Tax Agility aim to bring revolutionary accounting techniques to provide solutions that are in keeping with you or your teams innovative mindset.
Taking the decision to go from a solo entrepreneur, plying his trade alone in a world filled with ‘big ideas’ to an incorporated company can be life changing. Intimidating? Yes, but undoubtedly a potential life changer.
Right off the bat, there are a handful of tax benefits available to UK based tech & media companies, especially ones relating to the development of new products/innovations in the sector. Having a limited company is the best way to take advantage of these tax benefits.
Research & Development
The majority of tech companies will spend on Research & Development (R&D) at some stage of the companies life. HMRC are generous with corporation tax reliefs relating to R&D, especially small and medium sized companies. As of the 1st of April 2015, the tax relief on allowable R&D costs for small to medium sized businesses is 230%. This means, for each £2,000 of qualifying costs, your company could have the income that’s liable for corporation tax reduced by £2,600 on top of the original £2,000 spent. This new scheme, innovative in its own right, also includes a tax credit (11%) on the amount of qualifying R&D expenditure, payable to the company in certain circumstances. R&D capital allowances are also available to provide 100% tax relief on capital assets acquired for R&D purposes.
In order to qualify, a company’s R&D project MUST contribute directly to advances in the fields of science or technology.
Both R&D tax relief and R&D capital allowances can be claimed through your company’s annual tax return.
If your company has any profits coming from a patented invention, there’s an optional corporation tax rate of 10% (will be available in time) on the proportion of profits derived from:
- Using the patented invention in the company’s trade.
- Licensing or selling such rights.
- Selling the patented invention or products involving the patented invention.
- Compensation from infringement
This is known at the patent box regime. It’s being phased in over 5 years, the full benefit being made available from 1st April 2017. Having started in April 2013.
More information can be found on the government website.
The benefits mentioned above are 2 of many. Here at Tax Agility we know all the relevant tax exemptions, benefits and rules relating to tech start-ups. That’s why we’re proud to call ourselves experts in accounting for tech startups. We can provide a range of services to help provide a cost effective, time efficient accounting solution that’s perfectly suited to you and your business. If you’re a tech start-up or are thinking of starting one, give us a call. We’re specialist accountants for Tech StartUps and are waiting for your call.