Manufacturing businesses across Wales and the wider UK are increasingly embracing R+D Tax credits.
R&D Tax Credits are a tax break that has been put in place by the UK Government which allow companies to reclaim up to 33% of their R+D Costs.
SMEs, regardless of whether they are profitable or loss-making, can get up to 33% back on qualifying R+D projects regardless of whether or not the project is a success. Larger companies can get up to 10% of their R+D costs refunded.
Currently the Manufacturing sector is preparing to deal with what many have described as ‘Industry 4.0’ which describes the industrial landscape as it adopts more digital and automated functions.
Because of this many firms are now looking into developing leaner manufacturing processes or looking to invest in their production technology or software infrastructure.
Many of the costs associated with making these investments can qualify as R+D spending. A more expansive list of costs that are claimable include;
- Staff costs
- Agency workers
- Subcontractors
- Materials purchased (including those used in trial production runs)
- Software licenses
If your company has ever invested in developing internal processes or products, many of the above are probably costs which you are familiar with.
So, because of this increased push towards automation and digitalisation, many manufacturing firms are pursuing R+D projects, and reaping the benefits of claiming R+D tax credits to re-coup some of the costs to further invest in their businesses.
Matthew Jones, Managing Director of LimestoneGrey, Wales’ leading independent Chartered R&D tax credit consultancy, spoke on why Manufacturing firms should look into R+D Tax Credits;
‘The cash boost from an R&D claim can be hugely beneficial to Manufacturing companies as this money can be utilised for future R&D spend, making the company even more competitive in an increasingly congested industry.
The scheme was introduced by the Government to reward innovative companies. Manufacturing companies are investing millions of pounds to further technology and process, so they should reap the benefits.’
If you would like to speak to someone about whether your business might qualify for R+D tax credits, contact LimestoneGrey today.
