R&D Cost Capture
Pull the costs that go into the credit straight from your accounting and payroll systems and code them to projects, so the numbers stay tied to the books instead of living in a spreadsheet.
The problem it solves
In many businesses the cost side of a research claim is built in a spreadsheet by someone who exports payroll and accounting data, re-keys some of it, adds a few formulas and hopes nothing was missed. That works until someone asks where a number came from, or until a later change in the books means the spreadsheet is out of date. The cost capture module replaces that fragile step with a direct connection, so costs come from the source and carry a link back to it.
What it does
The agent brings in wages, supplies, contract research and cloud computing costs through accounting and payroll connections, and codes them to projects. That keeps the numbers tied to the books instead of re-keyed in a spreadsheet. Which categories of cost count toward a claim is a matter of the tax rules and your reviewer's judgment, so the module collects and codes them and leaves the decision on what to include to a professional.
How it works
- 1
Connect systems
Link your accounting and payroll tools. Common ones are Xero, QuickBooks and Gusto, or a custom API. Each connection is confirmed for your setup.
- 2
Import costs
Costs are pulled in and matched to people and projects, using the time allocation where wages are concerned.
- 3
Check and adjust
You review the coding and fix anything that looks wrong. Changes are recorded with a reason.
- 4
Hand to the calculator
Coded costs flow to the credit calculation, and each figure keeps a link to the record behind it.
Cost types and what the module does with them
Whether a particular cost qualifies is for your reviewer to decide.
| Cost type | Where it comes from | How it is coded |
|---|---|---|
| Wages | Payroll | By person, split across projects using time allocation |
| Supplies | Accounting | To the project the supplies were used on, with invoice link |
| Contract research | Accounting | To the project, with contractor and scope noted |
| Cloud computing | Accounting and cloud billing | To projects by account or tag, where records allow |
What you get
- Costs traced to the books, with no copy-and-paste in between.
- Less manual re-entry, and fewer places for an error to creep in.
- A clear audit trail from dollar to source record.
- A list of costs that could not be matched to a project, so nothing is silently dropped.
- Consistent coding rules you can see and change.
A worked example (illustrative)
This scenario is invented. A small company pays six people through its payroll system and buys test hardware and cloud capacity for a new product. The module imports payroll for the year and the accounting entries for supplies and cloud services. It applies the time allocation to wages, so each person's cost is split across projects. It codes the hardware to the project named on the invoices. For cloud costs, one account is tagged by project and another is not. The agent codes the first and lists the second as needing a decision. The finance lead decides to allocate the untagged account by usage share and records the reason. The reviewer later opens a figure and follows it to the ledger entry.
Why traceability matters
If a claim is ever questioned, the questions tend to be simple: where did this number come from, and does it match the books? A claim built from direct imports can answer both quickly. A claim built from a spreadsheet may need hours to reconstruct the answer, and sometimes cannot. Traceability also helps the people preparing the claim: errors in the books show up as mismatches, and can be corrected at the source.
Limits
The module is only as good as the data it reads. If accounts are coded inconsistently, or if payroll and accounting disagree, the agent will surface the mismatch but cannot resolve it. It does not decide what qualifies, give tax advice or file anything. Connections are proposals until confirmed for your setup, and access is limited to what the work needs. A licensed CPA or enrolled agent reviews the coded costs before they are used in a claim.
Connections are confirmed for your setup before you rely on them.
Common coding problems the module surfaces
The module lists these for a decision, so nothing disappears without a record.
- Accounts that mix research costs with ordinary operating costs.
- Cloud bills that cover several projects with no tags.
- Contractor invoices that describe a deliverable but not the project.
- Payroll entries for people who changed roles during the year.
- Supplies bought centrally and used across several projects.
Keeping the books and the claim in step
A claim built from direct imports stays in step with the books. If an accountant corrects an entry after the first draft, the correction flows through and the affected figures are flagged. That avoids a familiar problem: a spreadsheet that was right on the day it was built and wrong a month later. It also means the finance team and the reviewer are looking at the same numbers, so conversations are about decisions rather than about whose figures are correct.
What to prepare before connecting
Before connecting systems, check that your chart of accounts is reasonably tidy, that payroll records identify people consistently and that you know which accounts hold research-related costs. A short conversation with your accountant beforehand usually saves time later. We help you decide what to connect first and agree access in writing.
Cost capture questions
Which systems does it connect to?
Common ones include Xero, QuickBooks and Gusto, and a custom connection is possible for others. Each is confirmed for your setup.
Does it change my books?
No. It reads from them. Corrections are made in your own systems.
What about costs that do not match a project?
They are listed for a decision, not dropped. You can assign them or mark them as excluded, with a reason.
Can it handle contractors?
It imports contractor payments and links them to projects. Which payments count is for your reviewer to decide.
Keep exploring
Xero Integration
Connect Xero to our R&D tax credit and AI products.
Learn moreQuickBooks Integration
Connect QuickBooks to our R&D tax credit and AI products.
Learn moreGusto Integration
Connect Gusto to our R&D tax credit and AI products.
Learn moreCustom API Integration
Connect any system that exposes an API.
Learn moreR&D Documentation Capture
Capture R&D evidence while the work is happening, filed by project and ready for a reviewer.
Learn moreFour-Part Test Screening
The agent tags each activity as qualified, unqualified or needs review, with reasons.
Learn morePlease note: Estimates and drafts are prepared by software for review by a licensed CPA or enrolled agent. This is not tax advice.
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