‘Manufacturers make the most of R&D tax breaks’
MANUFACTURERS and firms in the technology, media and telecoms (TMT) sector are carrying out the most research and development, according to accountancy firm Deloitte.
It said the two sectors accounted for 40% of the tax advice related to R&D spending its North West team carried out from 2009-11.
Manufacturing – which includes aerospace, automotive and chemicals – represented 21% and TMT another 20% of projects.
Other leading sectors were energy and resources (17%), financial services (16%) and business and professional services (13%).
The incentives are delivered either as tax deductions based on R&D spending or, for some loss-making firms, as repayable cash tax credits.
SMEs are entitled to an R&D tax credit of 225% which means that for every £100 a company spends on R&D it will be able to set £225 against its tax bill. For larger companies that figure is 130%.
Steve Blacker, director of R&D tax services at Deloitte in the North West, said: “We are privileged to work in an area like the North West, which has a proud history of innovation and hundreds of businesses that are dedicated to research and development.
“Our job is to ensure that they take full advantage of the incentives out there for them. R&D is a huge investment for any business and can take months or often even years to pay off. Unfortunately we find that many companies are not fully aware of all the aspects of R&D investment thatthey can claim against.”
