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Ask the expert - R&D Tax Relief for Process Innovations: Beyond Product Development
15 July 2024
Today, we’re asking Visiativ Innovation Funding Expert Graham Beck, about an often-overlooked area of R&D tax relief : process innovations. While product development typically takes the spotlight, businesses can also claim significant tax relief for innovative improvements to their internal processes.
Read on to learn how to include process innovation in your R&D tax claims…
Q | Hi Graham, can you explain what process innovations are and why they qualify for R&D tax relief?
Absolutely. Process innovations involve implementing new or significantly improved production or delivery methods. This could include changes in techniques, equipment, or software.
Q | What makes a process innovation eligible for R&D tax relief under HMRC guidelines?
HMRC looks for three key factors: for a process innovation to qualify, it must represent an advancement in science or technology, address scientific or technological uncertainty, and the solution must not be easily deducible by a competent professional in the field.
Q | Can you give us some examples?
Sure, here are a few examples:
– Manufacturing Efficiency Enhancements: Developing a new method to streamline manufacturing processes, reducing waste and increasing production speed.
– Supply Chain Optimisation: Creating a more efficient logistics system using advanced algorithms and real-time data tracking to reduce delivery times and costs.
– Energy Consumption Reduction: Engineering new processes that significantly reduce the energy consumption of production facilities.
– Quality Control Improvements: Developing advanced testing methods that provide more accurate and faster quality control checks.
– Healthcare Process Innovations: Implementing a new patient data management system that integrates various healthcare providers’ information to improve outcomes and streamline operations.
– Construction Process Improvements: Creating a novel approach to modular construction that reduces build time and improves structural integrity.
Q | Very helpful, thanks! Any final thoughts for companies looking to explore R&D tax relief for process innovations?
Process innovations are an integral part of business growth and efficiency. By taking advantage of R&D tax relief, companies can unlock additional resources to drive further innovation and maintain a competitive edge. It’s worth taking the time to evaluate your processes and see where you might be making qualifying advancements.
