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How Ammu built their in-house R&D tax service & created a positive cycle of investment

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This month we caught up with chartered accountants, Ammu, to find out what they are doing to grow their in-house R&D service using WhisperClaims technology and why R&D tax relief is creating a positive cycle of investment for both them and their clients.

What led you towards offering an R&D tax service?

R&D tax credit is a stream of funding that has been somewhat overlooked by accountants in the past, not least due to unfounded myth and misunderstanding of the scheme. Government statistics suggest that only 10-20% of eligible SME’s have claimed R&D tax credits. A few years ago, I started to look at how I could grow our business and push it a bit further. We got in touch with an R&D specialist who convinced us that R&D consultancy was an opportunity for us and our clients. So we joined forces with them to offer an R&D service to our clients.

What inspired you to bring your R&D service in-house?

After about three years I had built up a bit of confidence to grow our R&D business. I felt that there were some weaknesses in how the R&D specialists were operating. They were overestimating the valuations of claims and charging a very high percentage fee. I questioned the professionalism of this given the purpose of the scheme and started to look around at alternative ways to run our service. I began to look for other specialists to pair up with until I discovered WhisperClaims.

What impact has this had on your firm?

Having an in-house R&D service enables us to grow. We can go to companies, offer them our service and then ultimately, as they grow, they remain as clients with us and the whole chain of events continues.

How does it benefit your clients?

I look for clients who are like-minded and forward-thinking. I tend to click with these people and enjoy seeing them get money back that they can reinvest into their businesses. They go on to hire people, they buy capital equipment and they move their businesses forward.

What appeals to you about WhisperClaims?

I like the structure and the compliance of it. We are already using software for corporation tax and personal tax so I could see clearly how this system could be rolled out. It’s also quick and efficient. We use it to collaborate with clients which enables them to understand the claims process better and gives them confidence.

How do you plan to grow your R&D business?

I hired a development manager last May with a view to running an in-house R&D service.  Our goal was to get more clients coming to us for R&D claims so that they could invest the tax benefit into machinery, people and further R&D activities. As they grow through innovation, we do too.

What tactics do you use to attract clients?

We use various platforms including webinars, blogs and videos to engage with our clients and to identify funding opportunities on an ongoing basis. We’ve already put through 30 claims doing that and we’ve got another 15 on the go at the moment. We’re just about to do a big marketing campaign where we’ll be approaching over 2,000 innovative companies. If accountants like us looked, they’d probably find about 20% of their clients could potentially have R&D claims.

Can you describe a success story or a client win?

We’re focussing a lot on food and engineering because these are the areas that are not claiming R&D tax relief. We’ve created educational content specifically for them and that has driven clients towards us from these sectors. We have an Indian food company that supplies quite a lot of products to supermarkets. It’s all-natural products, there’s no preservatives or anything like that and they’re on to their second round of investment. There’s an engineering firm that wanted to buy a £200,000 crane. We made a claim for them and this massive crane was purchased with the tax benefit that came back.

Should more accountants be preparing claims for their clients?

Yes. There’s a lot of players out there who are inflating claims and giving the R&D sector a bad reputation. They don’t always have the best interests of the clients at heart. Accountancy firms are different, we’re not a separate brand just dealing with R&D. We’re there with you, all the way through. There’s a professional assurance that no matter what happens, we’re going to be there.

How does WhisperClaims help you to support your clients?

WhisperClaims helps build trust because when you collaborate with a client to prepare a claim they become familiar with the criteria. It unfolds in their minds – they get to see a little picture of what’s allowed and what’s not allowed. We reach a depth of understanding that I think others wouldn’t bother to go into. We do the smaller claims too, because we can, because the software allows us to do it in such an efficient manner.

What’s ahead for your firm?

In order to keep R&D consultancy going, I think you need fresh contacts and fresh partners in place. During the financial crisis of 2008 there were a lot of accountants who were going to retire but instead held on. So I think in 2020 there will be a lot of acquisitions available. We’re also interested in working with more accountancy firms to undertake R&D claims for their clients. This would enable R&D tax to become an integrated service within their practice. The main objective for us is to help more businesses with tax relief in order to create a positive cycle of investment.

About Ammu

Ammu is a team of chartered accountants and chartered management accountants based in Central and South West Scotland. They offer a diverse range of services including consultancy on digital systems, tax, compliance, funding, company vision and R&D tax relief. They use cutting edge technology, including WhisperClaims software, to support their clients and enable them to make better business choices.

How to write an R&D tax relief technical narrative

With HMRC’s new mandatory requirement for project descriptions on all submissions, we wanted to share our experiences to help others to write their best possible technical narratives.

Available to download here.

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