Innovation voucher for £3,000

[Martin_s]

How do I account for an innovation voucher?

The voucher is for £3k to be spent with any academic institution.

We have had the research done by a university and have now been invoiced.

The invoice shows:
Services £3,000+525(VAT)
- Innovation Voucher £3,000
= Payable of £525

I have no problem with the vat element but what do i do with the £3000 in my books? Do i just put R+D of £3,000 and contra it somewhere?

[Zeno]

I would show it as £3k in R & D (which I assume you are writing off to the P & L) and £3k of grants received.

[David Griffiths]

I wouldn't show it anywhere - in other words net off the voucher received against the money spent. Just enter the payment of £525 as £0 goods and £525 VAT

[Martin_s]

Thanks for taking the time to reply. Appreciated

[Jaydee]

I would not net it off, particularly if the outlay was true R+D, as you would be losing the benefit of the 150% tax break.

[David Griffiths]

I would not net it off, particularly if the outlay was true R+D, as you would be losing the benefit of the 150% tax break.

The Revenue's site here (http://www.hmrc.gov.uk/ct/forms-rates/claims/randd.htm) has this to say about subsidies:

Subsidies and grants

If your company or organisation has received a subsidy or grant for an R&D project, this may affect how much tax relief you can claim. If the subsidy or grant is a 'State aid' recognised by the European Commission, then you can't claim anything under the SME Scheme. For any other type of subsidy or grant, the R&D expenditure you can claim for is reduced by the amount of subsidy or grant received.

[Zeno]

I wouldn't show it anywhere

Why wouldn't you show it? (just curious)

For this sort of thing I would always tend to disclose on the face of the P & L even if it does come down to no effect. The company incurred R & D costs of £3,000 and they received grant funding of £3,000 (essentially) which to my mind are two separate transactions.

Unless you take the view that the company would not have commisioned the research if it were not being funded.

[David Griffiths]

Why wouldn't you show it? (just curious)
.

Because the company incurred no R&D costs, as they were paid by somebody else.