It looks like Northern Ireland has really got on board with the message that investing in R&D will drive forward the economy – or has it?
According to the latest R&D figures, Northern Ireland reported the largest annual increase in in-house R&D expenditure in the last year of any UK region.
Last month’s Northern Ireland Research and Development Survey revealed that in 2015, businesses, higher education and government in Northern Ireland spent £749.6m on R&D.
That was an incredible 24% increase of £143.7 million on the previous year, with around 90% of the rise (£129.5m) accounted for by the private sector. It’s the highest level of R&D spending ever recorded by the survey.
There’s just one thing, 46% of Northern Ireland research and development spend was carried out by just 10 companies – so what exactly is everyone else doing?
Innovation network Catalyst Inc has just published its Knowledge Economy Index 2016 and it has delivered a warning that we all need to heed.
“With a small number of large firms carrying out the lion’s share of R&D, NI is particularly exposed to the investment decisions of these firms. The challenge is to continue to broaden the R&D base,” the report said.
A Catalyst Inc spokesperson went on to call for greater resources to be made available to companies in order to help them scale and grow.
It does look as if the message is getting through to small and medium-sized companies (SMEs), however.
Between 2014 and 2015, R&D expenditure by SMEs increased by 33% – a figure of £62.8m.
So now is the time to take stock and think about how your business could benefit from R&D and whether you are getting all the support you could from R&D Tax Credits.
For one thing, R&D is not just product creation, but also activity around evolving existing production techniques, updating internal processes and improving business efficiencies.
So, is your business embarking on a project that addresses an area of scientific or technological uncertainty and being innovative?
To help increase Northern Ireland research and development we advise SMEs to explore the benefits of R&D tax credits.
- To qualify, the innovation needs to be an improvement in the overall knowledge in the relevant field of research, not just an advancement for the company.
- If you qualify, you could claim additional tax relief of 130% on every pound. This is over and above the 100% allowance given or original expenditure. As long as you continue to innovate, you can make a claim every year.
- And finally, learn more about Research and Development Tax Credits and how much R&D relief you could claim.