The 3D Printing Sector
Although 3D printing was invented in 1967, it’s impact on volume manufacturing is set to become highly disruptive from 2025. Between now and then ever decreasing costs will increase the number and scope of customised products made locally. The UK is very focused on becoming a leader in 3D printing through research and development in so called Additive Manufacturing.
R&D tax credits for 3D printing
Research and Development (R&D) is vital for the growth of any forward-thinking business, and R&D Tax credits is a scheme that allows companies to claim back a certain level of tax depending on how much they have spent on innovation. According to Jack Tindale, manager of the All-Party Parliamentary Design and Innovation Group (APDIG), ‘Only six per cent of firms that could claim for it actually do.’
The advances in 3D printing have seen the technology move into multiple industries, even some where you may not initially consider that it would work. For example, 3D printed food has been developed and is currently a viable form of creating different meals. If you use your 3D printer to help with R&D processes, then you are very likely to be eligible for R&D Tax Credits.
There are broad guidelines as to what is determined to be R&D, and what exactly will qualify for the tax scheme. Many of these are dependent on the aim of the final project i.e. to find a better component to fit a machine part, or the goal of the study i.e. to discover a faster way of creating a certain piece of machinery.
Not every aspect of the printing process is eligible for the R&D Tax Credit relief. A portion of the entitlement is also due to what the finished prototype is used for and at present firms which sub-contract others to do the work, cannot claim the credits for the work they do.
So a considered approach to the best use of resources, materials and available workforce, as well as the initial outlay and gains to be made, is also important to balance. Expert advice is available to ensure that full entitlements are received, and that any provisions that affect the eligibility of the scheme will be explained so you can make the best decisions for your company, and claim back the tax relief you are entitled to.
For product designers and creators, developing a newly improved item or 3D printing component parts that they used to buy in, these steps would be considered eligible for the scheme. They are typical of R&D activities, and directly work to improve the business or the processes in their relevant fields. This may also be the case for businesses that are not looking to create new items, but rather prototype new techniques to create them. Under the R&D scheme, this activity would likely be considered as research and development, and qualify for the assistance.
Using a 3D printer to create fast and relatively inexpensive prototypes is also considered to be eligible under this scheme. So too is the use of these printed models and the application or combination of virtual / augmented reality – a system that allows a company to find and detect flaws or issues before a costly initial run, is engaging in exactly the work these tax credits are designed to give relief with.
Some companies will use their printers to engage in traditional research and development – creating a minimum finished viable product that accurately represents the item or line they are wishing to develop. Even the creation of new product packaging can be listed as R&D under the scheme – if it improves or betters the product, then the time and associated costs involved may be eligible.
Other companies are taking their 3D printers and pushing them to their utmost limits to see both what they are capable of, and what they can do for their business. This exploration, with an underlying understanding that their findings will be used for the betterment of the business or research area as a whole, mean that they are more than likely eligible for the R&D tax credits.
The use of a 3D printer could bring your research and development up to the cutting edge, and allow for reduced production costs, new innovations or the expansion of your business into a new area. With all these stages, research will play a vital role, and in many cases can be supported by the financial returns available on the R&D tax credit scheme.
Investigating your eligibility could save you money. Easy R&D have helped hundreds of companies to make R&D tax relief claims. Contact your nearest R&D Consultant to see if you can claim on 0800 195 7516.