Is your brewery or distillery eligible for Research & Development Tax Relief?

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The brewing and distilling industries are fiercely competitive and it is therefore paramount that these businesses continuously innovate and develop new beers and spirits, in order to deliver the best products possible and help them stand out from the crowd. 

This innovation takes a considerable amount of any brewer’s time. There are substantial costs incurred both in terms of time and materials associated with transforming an idea through the trial phase and, if successful, bringing it into production and to market. 

What you may not be aware of is that these costs could be eligible for additional corporation tax incentives through the Research & Development (R&D) Tax Relief Scheme. 

For small and medium-sized companies eligible, qualifying costs attract an additional 130% enhanced deduction.  

Companies can therefore receive relief in a variety of ways: 

  1. For profit-making businesses, this is an additional 130% deduction from your taxable profits. That’s a tax saving of 24.7p in every £1 of qualifying expenditure identified. 

  2. If your business is loss-making, these losses can be offset against profit of the previous year or carried forward against future profits.  

  3. Tax losses can also be surrendered for an immediate cash repayment in the form of an R&D tax credit for a rate of 14.5%. Such repayments can be as generous as 33.35p received for every £1 of qualifying expenditure. 

These can dramatically improve your cashflow position if you have substantial costs that you have incurred on R&D projects. 

Enhanced Capital Allowances may also benefit your company where it has invested in specific equipment to assist with R&D activities. 


HMRC outlines very specific qualifying conditions for a project to be eligible for R&D tax relief and Armstrong Watson’s Tax team have vast experience in preparing and submitting R&D claims. If you feel like this may apply to your business and would like to discuss this further please contact Matthew Hutton on 01539942066 or email matthew.hutton@armstrongwatson.co.uk

Contact Matthew

The deadline for June 2021 claims is 14 July 2021. If you require our JRS team to submit your claims please send them to jrs@armstrongwatson.co.uk by 9 July 2021. For details on the changes to the scheme visit our CJRS page.