Research and Development Tax Relief for the Food And Beverage Industry

Food and Beverages R&D Tax Credit

One of the most thriving industries in the UK is food and beverage. Many food and beverage companies invest heavily to come up with new formulas to make their products better. They use everything from equipment, improved packaging systems and automation technologies to keep afloat with the competition and attract more customers.

Despite all of the action within these industries, many companies fail to claim any tax relief from Research & Development. R&D tax credit is a UK Government scheme which was set up to encourage businesses using innovation to improve their products and processes or bring new ones into the market.

One of the major activities that many food and beverage companies do is, develop new products. A further study shows that these industries use tremendous amounts of money to extend their product lines and make improvements on their already existing products.

Besides these costs, the industry incurs many expenses on staff salaries, packaging, food products, transport and other overheads. Fortunately, for this industry, R&D offers tax credit can help to offset many of the expenses. For that to happen, it is important to know the sectors of the food and beverage industries that qualify for R&D tax relief.

What activities in food and beverage benefit from R&D tax credit?

  • Developing ingredients or food formulas that are both new and sustainable
  • Developing the food content nutritional value
  • Improving the texture and taste of the food
  • Coming up with improved product formulations
  • Production of samples during the test runs of a new product
  • Development of better ways to curb costs
  • Development of better ways to improve on the consistency of the product
  • Development of faster, healthier, safer and easier ways of food handling
  • Development of improved ways to add to the food shelf life
  • Developing new ways to add to the product integrity
  • Introduction of better and more durable packaging materials
  • Developing better ways to minimise contamination
  • Improving on ways to deal with waste, spoilage and scrap
  • Developing better ways to ensure that the products are eco-friendly
  • Improvement of energy efficiency of fuel, water, and other utilities by using new and advanced technologies in the market
  • Conversion of waste to energy processes
  • Indirect activities like finance, administration, personnel services and training
  • Expensed costs through the profit and loss account

How R&D tax credit works to benefit food and beverage industries

One of the reasons many food and beverage industries fail to claim R&D tax credit is because they do not know whether they qualify and exactly how the credit scheme works to benefit the sector.

The first step to take is reviewing all the activities in the industry, which include the developments of new products and the improvement of existing ones. Then look at all the expenditures to check out what qualifies for tax credit relief and what does not qualify.

  • If you have technical personnel and engineers carrying out most of the development and improvement activities, then you definitely get to benefit fromR&D tax credit.
  • If the activities carried out in the industry include salaries that are taxable, supplies, other wages, and contracts, then you get to benefit from R&D credit tax relief
  • If the activities carried out are of a technical nature based on physical science, engineering, biological science or computer science, then your company gets to benefit from R&D credit tax relief. Note that you do not have to employ all the science principles for you to benefit. It could be any of the mentioned sectors.
  • If the activity involves the creation of a new product performance, quality, reliability and function, then you benefit from the tax relief
  • If there are any uncertainties of the activity in the areas of design, methodology and capability, then you stand to benefit from the tax credit relief
  • If the activities are of experimental nature like the evaluation of more than one alternative, modelling and testing performances, analysing, reforming, abandoning, hypothesis and examination, then you also stand to benefit from R&D tax credit relief

What research and development staff roles are included in R&D tax credit claim for food and beverage projects?

An R&D team consists of individuals from diverse businesses. These may include a project team from R&D led by a manager, engineers, lead developers, testing and quality control specialists, accountants, project co-ordinators and other senior members of the management.

Why contact us?

We can help you to receive tax credits on a number of costs, especially those associated with research and development among others. This will give you the motivation to carry out further research and development.

If you are not sure how to do that, we have a team of experts that are ready to come and assess your company to give you the way forward.

Simply complete the claim form by clicking the box below and we will come to you.