Congratulations! Your WBSO application has been approved by the RVO. This is a major milestone that can significantly reduce your Research and Development (R&D) wage costs and boost innovation within your company. In this guide, we’ll outline the essential next steps to ensure compliance and maximize your WBSO benefit.
1. Understanding your WBSO benefit
Your approval letter outlines the granted tax reduction for R&D wage costs. It is essential to apply this benefit correctly in payroll to maximize your financial advantage. Additionally, you must track R&D hours and costs as specified in the approval to ensure compliance. Strategic planning is also necessary to make the most of the financial impact of WBSO on your business.
2. Setting up proper administration
To stay compliant and audit-ready, maintaining accurate records is crucial. Timekeeping and documentation of R&D activities should be precise, logging the hours of employees working on R&D activities accurately. RVO expects a structured overview that links R&D hours to specific projects. If you have received WBSO for costs and expenditures, you need to maintain records for them and document their attribution to specific projects. Keeping track of project progress and milestones ensures that in case of an audit, your R&D efforts align with the WBSO claim. Errors in documentation can lead to penalties or lost benefits. Expert guidance ensures compliance.
3. Utilizing the WBSO Tax benefit effectively
Applying your WBSO tax credit correctly is essential to maximize its impact. Integrating WBSO into payroll should be done accurately to ensure that the full benefit is utilized. Companies must ensure that all eligible R&D wages are correctly recorded and the tax benefit is properly reflected in financial statements. Common mistakes, such as misallocating reductions or failing to apply them efficiently, should be avoided to maximize financial gains and prevent administrative complications.
4. Preparing for an RVO Audit
RVO audits check whether businesses comply with WBSO requirements, making it essential to be well-prepared. Keeping clear and up-to-date R&D and financial records is a must to provide accurate documentation when needed. Consistency between the claims submitted and actual execution is crucial to avoid discrepancies that may raise red flags. Any inconsistencies between payroll reductions, reported R&D hours, and project documentation can trigger scrutiny and should be avoided at all costs.
5. Reporting the realization of R&D Hours
After receiving WBSO approval, businesses are required to report the actual realization of R&D hours to the RVO. When applying for WBSO, companies provide an estimate of the required hours, along with any projected costs and expenses. With the realization of WBSO, businesses must report the exact number of R&D hours worked and any actual costs incurred. This mandatory report must be submitted no later than 31 March of the following year.
Our WBSO support?
Managing WBSO efficiently requires expertise. Our WBSO Experts at FFUND help with:
- Accurately tracking R&D hours and costs
- Fully optimizing WBSO tax benefits
- Ensuring compliance with RVO regulations
- Preparing for audits without stress
- Leveraging WBSO to maximize long-term innovation benefits
