As an ecommerce business owner, you'll always be on the lookout for ways to generate more revenue and save costs. In this blog post, we'll discuss three sources of cash that every ecommerce business should know about.
R&D Tax Credits
The first source of cash that every ecommerce business should know about is Research and Development (R&D) tax credits. Many people assume that R&D tax credits only apply to large corporations, but the truth is that any business that invests in developing new products, processes, or services could be eligible for R&D tax credits.
To determine if you're eligible for R&D tax credits, you'll need to evaluate your business activities and determine if they meet the criteria for "qualified research expenses." If your business activities do meet the criteria, you could be eligible for a significant tax credit that could provide your business with some much-needed cash.
In the ecommerce space, tax credits can apply to activities ranging from developing your own custom systems, inventing products, improving manufacturing processes, through to integrating AI in an innovate way to provide better personalisation to customers on your website.
R&D tax credits can be a significant source of cash for SME businesses and can be worth as much as 33% of the qualifying spend.
Amazon Inventory Reimbursements
When you sell products on Amazon, there are times when Amazon may end up owing you money, in particular when they lose or damage your inventory. Unfortunately, Amazon doesn't always proactively refund you for these errors.
That's where GETIDA comes in.
GETIDA is a service that helps you reclaim your Amazon inventory reimbursements. By using their software, GETIDA can identify any reimbursements that Amazon owes you and automatically file a claim on your behalf. This can provide your ecommerce business with some much-needed cash that you may have never realised was available at such a low time-cost to you.
Working from Home Allowance
Many ecommerce business owners work from their own home, at least in the beginning, and as a result, you may be eligible for the working from home allowance.
To see if this applies to you, you can use HMRC's eligibility checker for tax relief.
To read more about this allowance and other expenses for limited companies, read up on the home allowance section of our expenses guide (note, the rules are slightly different for claiming for sole traders).
While you're there, check out some of the other expenses you can claim, in particlar the phone allowance which is generous and can let you write off the full cost of your phone contract.