Crystal clear: R&D tax claims

Posted on 7 Nov 2012 by The Manufacturer

R&D Tax Claims Ltd helped a 125 year old manufacturing company successfully reclaim tax spent on research and development.

R&D Tax Claims, a Wolverhampton-based tax specialist, assisted West Midlands based Glassworks Hounsell in reclaiming £29,400 from HMRC under the research and development (R&D) corporation tax reclaim scheme.

Glassworks Hounsell manufacture precision engineered machinery for making all kinds of industrial formed glass. The company also make canning and plastic bottle manufacturing machines and specialise in the design and development of tin oxide electrodes used for melting glass.

“If we can design it, we’ll build it”, says William Brinkman, director of sales.

“The glass manufacturing industry is still our biggest customer and we supply many of the famous names, including crystal companies Waterford and Baccarat and building materials company Saint Gobain, and 90 per cent of our product is exported to Europe, the Far East, China, USA and Thailand. The growth in touch screen technology and flat screen TVs and displays has been hugely beneficial to us.”

Just rewards

R&D Tax Claims had to move fast to help Glassworks Hounsell reclaim the money they were due. “Their year end was approaching”, explains Mark Evans, managing director of R&D Tax Claims. “But they were willing to invest a very small amount of time which has resulted in a successful reclaim. The process will be even more streamlined next time as they are now working the R&D reclaim element into their accounting practices.”

Glassworks Hounsell invest heavily in research and development. “If I’d been asked how much before we were introduced to R&D Tax Claims I’d have said around five per cent”, says Mr Brinkman. “Using the evidence we provided, Mark and the team were able to demonstrate that almost half of what we do is R&D, because we have to evolve continuously and learn from every new job.”

The company does not operate a designated R&D department, but like many businesses involved with innovation, learns by trial and error through the process. “It can occasionally involve building an entire prototype machine in order to solve problems”, explains Brinkman. “But we didn’t consider this to be R&D, we were just doing what any company does to stay ahead of the game. We then reinvest the knowledge learned in the next job.

A meeting of minds

Glassworks Hounsell established its relationship with R&D Tax Claims through a university Knowledge Transfer Network (KTN). Mr Evans says it is increasingly working with these kinds of schemes because they provide a rich of R&D capability and talent. “This translates into growth in the jobs market and the successful progression of the UK manufacturing sector,” he observes.

“Using the evidence we provided, Mark and the team were able to demonstrate that almost half of what we do is R&D,” William Brinkman, director of sales, Glassworks Hounsell

Brinkman recalls his introduction to R&D Tax Credits positively. “We found out about the HMRC R&D scheme through links with Richard Simpson and the Science City Knowledge Transfer at The University of Birmingham” he says. “Richard then made the introduction to R&D Tax Claims. We looked at the scheme previously but didn’t feel that we did any white coat development. Richard thought we should be reclaiming however, and the cheque for nearly £30,000 proved he was right.”

“I was very surprised at the speed of everything and we’re delighted with the reclaim”, concludes Brinkman. “It was quick and painless and the time invested was about a day. We see this as an ongoing process and will be claiming through the scheme yearly from now on.”