TaxNova, a London-based startup, has announced $1 million in pre-seed funding for its platform that automates R&D tax credit claims for tech companies. Backers include a16z’s accelerator, s16vc, and operators from Revolut and Miro.

Automating the Claim Process

TaxNova aims to solve the difficulties associated with claiming R&D tax credits, a process that currently requires companies to gather and document qualified research expenses and supporting records. According to TaxNova, this process is often inefficient and risks exposing companies to tax audits, as well as taking up valuable time for engineering teams.

TaxNova's platform integrates directly with tools like GitHub, Jira, Linear, Slack, and Notion, automatically extracting data related to R&D activities. AI is used to identify projects, calculate eligible costs, and generate the documentation needed for tax audits. TaxNova states that its technology creates an audit trail linking every claim back to source documentation. The startup collaborates with R&D tax advisory firms.

The R&D Tax Credit Market

R&D tax credits are government incentives that lower a company’s tax bill. In the UK, companies claimed £7.6 billion in R&D tax relief in 2023-24.