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R&D Tax Credits for Manufacturing

The manufacturing sector receives more research and development (R&D) tax credits than any other. The majority of claims in the industry tend to be in development rather than research, e.g. in using novel methods to improve production processes. 

Yet, many manufacturers still underestimate the extent to which their process developments are eligible as R&D. Your manufacturing business could also be missing out on tens of thousands of pounds in R&D tax credits to spend however you choose. 

Your industry is sitting on the cusp of dramatic advances in artificial intelligence, robotics, and automation. With Brexit now finally done and dusted, the government is incentivising R&D in manufacturing to help British businesses — just like yours — maintain their authority and relevance on the world stage.

If you’ve recently introduced or improved products or processes, there’s a strong chance you could benefit from an R&D tax credit claim. Each challenge and solution sought can qualify as R&D.

close-up pf man welding
Manufacturing projects that may qualify for R&D tax relief include:
  • Tooling and equipment fixture design and development
  • Designing innovative manufacturing equipment
  • Integrating new materials to improve manufacturing processes
  • Evaluating and determining the most efficient flow of material
  • Increasing ease of operation or suitability of manufactured products
  • Developing processes that would meet increasing regulatory requirements
  • Modifying existing processes or systems to improve capacity and performance

Manufacturing Case Studies

Rannoch Adventure – boat building

Rannoch Adventure – boat building

Truck Hydraulics – manufacturing

Truck Hydraulics – manufacturing

EJ Electronics – manufacturing

EJ Electronics – manufacturing

 

Key questions on R&D tax relief answered

What activities can be included in a R&D project?

  • Defining technical objectives
  • Identifying uncertainties
  • Feasibility studies, reviewing new and competing technologies
  • Analysing, designing and developing the technology
  • Producing technical specification or other documents to explain and support the R&D project and advancement
  • Testing the product, process, service or software
  • Planning and managing projects
  • Administration, finance and personnel services specifically required to support R&D activities
  • Training to support R&D

What expenditure can be claimed for in a R&D project?

  • Staff Costs – Employee costs (salary, national insurance and employer pension) are apportioned for their time spent on the R&D project plus any reimbursed associated business expenses
  • Software – Purchased for R&D purposes and costs apportioned for any subsequent use
  • Subcontracted R&D – You can claim 65% of what you paid your R&D subcontractor
  • Utilities & Consumables – Water, fuel, power and material used in the project
  • Prototypes – Produced for R&D purposes

About Easy R&D’s R&D tax credit claim process

Claiming R&D tax relief is a niche.

Here at Easy R&D, we’ll probe your company’s activities to reveal the true extent of your company’s R&D.

Averaging £54,000 per claim, we’re a business built around expert tax professionals, skilled technical report writers, and flawless processes to ensure your R&D claims are successful — with maximum return. You could even reduce your corporation tax bill to zero.

HMRC’s criteria for claiming is purposefully broad, so what qualifies may surprise you.

 

Interested in claiming R&D tax credits?