Sector Overview – Telecommunications

Within the latest HMRC statistics on R&D tax credits, we can see that 25% of all claims made under the SME scheme, were for companies operating in the “Information and Communications Technologies” (ICT) sector. This accounts for 26.7% of the total value of claims.
The average claims value is £57,197.

Research and Development Tax Credits within the Telecommunications industry

Long gone are the days where we needed to dial an operator to ask to be connected to another person, when making a phone call. Thankfully so. Over the decades since first launched, the telecommunications industry has evolved at such pace, that it is barely recognisable to just a decade ago. However, to remain competitive within this industry, companies are constantly needing to push the boundaries. Eligibility for R&D tax credits centres around two key areas. Companies need to be either:

Producing new or improved products.

Design and development of a product involving some degree of uncertainty for which the answers were not obvious.

Examples of technological uncertainty within the Telecommunications sector

Integration of new technology
Due to the high-tech nature of the Telecoms industry, companies face many uncertainties when simply keeping pace with the latest technologies. This is further complicated by the increasing use of IP based services, because there is a need to widen the range of knowledge and skills to cover these new areas.
Development of third-party applications
As a result of the range of “third party” middleware increasing, the uncertainties being faced by companies aren’t eased. This is because each new application will need to be incorporated into the proposed system. This leads to there being questions on how to achieve this, because there’s no way to know how the applications will react with each other. When introducing third-party applications there is often a need for these to be developed for use, this is to make sure that they work as required.
Development of proprietary software or components
When there are no “off the shelf” solutions, companies will need to design their own. This will often involve a great deal of testing and experimentation before testing. During testing, there will often be further redesign needed to achieve the desired outcome.

Fiscale make the process of completing and applying for the R&D tax credits incredibly simple. We had put off applying for several year before meeting Stephen and his team, but they have now helped us successfully four years on the trot.

Brett Smallcombe, LG Networks