by Simon

March 31, 2020

how-do-i-record-workers-time-for-research-and-development-tax-credit-projects - R&D Tax Credits explained by Hamilton Wood & Co. London

Recording employees time attached to R & D initiatives needs to be an accurate and sensible evaluation of time used.

There are numerous free tools which will help document the actual time an employee invests on a project and these may be used.

You are able to claim 230% of directors pay and staff pay who are actively involved in a Research & Development process. Staff costs are a permitted expense for the purpose of R & D.

Frequently staff members may be doing a variety of different jobs in businesses.

It is important that a fair assessment of their time is worked out for inclusion in your claim.

The 2 main types of employees costs are:

  • Workers contributing to figuring out the technological challenge in the project directly
  • Then support personnel who are involved in the activity in some other capacity e.g. a Director of Operations loosely connected to an undertaking in some capacity. In plain English, a worker involved in qualifying indirect tasks.

When establishing the figures you ought to think about the nature of their role in the endeavour and the timeframe these people were taking part.

So here are several quick things to ask yourself with respect to involved employees:

  • Just what Research & Development actions did the employee tackle?
  • How many hours did they spend active in the activity?
  • Which qualifying tasks did the employee focus on during the timeframe?

Recording employees costs in a project

Clearly, keeping control of every detailed section of a Research and development mission can every now and then be overwhelming. All too commonly ‘business as usual’ normally gets in the way.

Let’s face the facts you’ve got a company to look after and paralysis by analysis has finished many organizations.

Many organizations have spent company money on ventures and only realized after the event that they may have the ability to recover some of their costs.

Working to unravel exactly how much time a member of staff has used on a task can be challenging…

It is critical that projects are looked at correctly and employees units of time are noted down in the correct way.

Make absolutely sure there is some supporting information and facts to help you and if you’re unsure, we’re happy to answer any questions you may have.

Where granular timekeeping reports aren’t obtainable examine what stats can be obtained and use a level of necessary reason. Can you really warrant 100% of peoples time over the length of the job?

As we have explained, you will discover free tools available that can help with the tracking of plans. Clockify is one such tool and can be found here: https://clockify.me/

Where we fit into the process is that we positively help our customers develop better processes so that each year your award is safely enhanced ensuring no stone stays unturned.

When tracking your employees amount of time in an assignment it often helps to do this in tandem alongside the current project activities.

Turning to guesswork to determine staff time is unsafe territory!

You should have some practical justification for the allotment of time put to use.

We suggest that you look at the process in its entirety and then work backwards from that point. Who should be involved and why?

At all times, you’ll want to ensure that the time calculated is accurate so you don’t falsify a claim that may leave your business open to a minefield of potential risk sooner or later.

Our team are happy to ‘hold your hand’ and provide the down-to-earth information and support you need to safely increase your R&D claim.

If you have any queries with regards to your R & D project, contact one of our helpful experts now – click here.