Food Processer- Defending an R&D Tax Credit Audit

ReaDI-Watch Case Study – R&D Tax Credit Audit

Have you ever been notified that your R&D Tax Credit Claim is going to be audited by an Expert for “Qualifying R&D”? Recently, a Food Processing company received this news, and immediately contacted ReaDI-Watch to help. Here is the case study:

Food Processor – Successfully Defending an R&D Tax Credit Audit 

ReaDI-Watch worked with a primary processing company to defend an R&D Tax Credit “Science Test” audit by the Irish Revenue Commissioners relating to a three-year old claim comprising 3 x R&D projects. While ReaDI-Watch cannot guarantee successful outcomes, our success rate is 100% due to our robust approach. 

Using the ReaDI-Watch Platform, the Food Processing company successfully defended their claim and became “audit-ready” in a period of less than 4-weeks. Here’s how:

ReaDI-Watch “Audit-Ready” Approach:

Firstly, the Food Processor provided ReaDI-Watch with all relevant materials relating to the claim. The lead contact from the Food Processing company, supported by ReaDI-Watch, uploaded all materials and reported the 3 x R&D projects using the guidance & structure of ReaDI-Watch Platform’s “R&D Project Manager”.

Secondly, the ReaDI-Watch team undertook an expert assessment of each project using the “Qualifying R&D Assessment tool on ReaDI-Watch Platform. They reported their results to the Food Processing Company, and identified gaps to be closed in order to achieve audit readiness. 

Thirdly, the Food Processing company took all of the information above and prepared for an audit. They undertook the following:

  • Closed the gaps identified for each of the 3 x projects on ReaDI-Watch.
  • Generated the automated “Summary Technical Reports” from ReaDI-Watch.
  • Submitted all reports to Revenue Commissioners.

Additionally, to ensure full audit readiness, they:

  • Prepared an “Overview” of R&D and Innovation in their company, to present to the “Science Test” auditor. They used ReaDI-Watch for this. 
  • Undertook ReaDI-Watch’s e-learning programmes in advance of the auditor’s site visit. 

Finally, the site visit by the “Science Test” auditor took place, and the Food Processing company presented each R&D project and provided an overview of R&D and Innovation in the company.

Timeline: 

  • From initial client engagement to R&D Tax Credit audit documentation submission was 4 weeks.

Outcome: 

The R&D Tax Credit “Science Test” audit was a success for our client. 2 out of the 3 R&D projects continued into future years, and the success of this audit ensured continued availability of the R&D Tax credit for the client. The size of the claim was approximately €150,000.-, a substantial portion of which was in the form of excess cash repayments.

The Food Processing company took the learnings from this exercise, and agreed to report and manage R&D in “real-time” from now on. ReaDI-Watch is being used daily in the company to report and manage R&D projects, and to capture the company’s strategy, policies and management structures for R&D and Innovation.