Sir George Cox
Chairman, Design Council
Design is an essential part of any good research and development (R&D) process – it helps to translate scientific knowledge into products that people can use and want to buy, and that companies can profit from.
Because R&D is good for the economy as a whole, the government gives companies that carry out research and development (R&D) money off their tax bill. This tax relief is given in the form of R&D tax credits. The relief can reduce a company’s corporation tax bill by up to 15% of its eligible R&D costs.
Understandably, a lot of people have been under the impression that this relief only really applies to traditional scientific research performed by men in white coats. But R&D tax credits can be claimed for product development work such as prototyping – as long as this design work is part of a broader technology-based R&D project.
Now that major companies, including Nissan, have managed to claim back their design costs, more and more companies are beginning to realise that they might be able to do the same thing.
For the R&D tax credit to stimulate the economy, more companies need to know about it. Our research estimates that only 10 per cent of businesses know that R&D tax credits exist. And financial advisor Deloitte estimates that only 55 per cent of SMEs eligible to make a claim for R&D tax credits have actually submitted one since the scheme started in 2000.
