Independent saves Â£20k with R&D tax credits
Independent contractor Satyan Kotecha has claimed back over Â£20k in retrospective tax relief after discovering that initiatives he developed to support his internet pharmacy made him eligible for Research and Development tax credits.
Innovative use of existing digital pen technology to track deliveries and record patient consultations, and the development of a hub-and-spoke model qualified Mr Kotecha for the tax relief, which was set against his corporation tax bill. Mr Kotecha, owner of K&K Healthcare, a group of three pharmacies in the Midlands, applied for the tax relief via RD Tax Solutions, which only charges a fee if it can make savings for clients.
Mr Kotecha estimated that the claim process took less than an hour of his time, and about an afternoon of his bookkeeperâ€™s time. He received his Â£20k tax relief within a month and now checks whether he can use the scheme for all new projects.
â€œIf I managed to get Â£20k back, imagine what other people could get back,â€ he said. â€œThe irony is that it was money technically due to me but I never thought I was innovative. It has helped me to think differently.â€
The credits can be applied to a wide range of business initiatives where risk is involved, said Mr Kotecha. For example, he funded pharmacy staff from two pharmacies to attend a travel vaccination training course, but the subsequent service was only successful in one of the pharmacies. R&D tax credits were used to mitigate any losses.
â€œSome pharmacists will be looking at costs at the moment, but this allows me to invest in, for example, a robot or hub and spoke and I can do it with little risk to my business. If the initiative fails, it reduces my tax liability. It allows me to invest confidently in my business without taking the risk.â€
Managing director of RD Tax Solutions Mark Tighe (pictured) said: â€œSadly â€“ according to HMRC itself â€“ under 1 per cent of the firms eligible for R&D tax credits ever make a claim. If youâ€™re a pharmacist carrying out work like Satyan, donâ€™t let that be you.â€