Research & Development (R&D) tax incentives
Research & Development (R&D) tax incentives are widely adopted in over 50 countries, with multiple forms of incentive available in many of the advanced economies. These incentives are popular as governments look to attract and sustain economic activity locally, as they are found to increase private investment, innovation and boost employment, as well as influence where global businesses undertake R&D and base their operations.
An increasing number of countries have recognised the importance of innovation for economic growth and prosperity, whilst also using these incentives to achieve other policy goals, such as digital transformation and environmental sustainability.
Research & development (R&D) tax incentive benefits
Across the world, companies save billions in research & development (R&D) tax incentives to help fuel their innovation. Research & Development (R&D) tax incentives may be available to companies who have invested in (or are considering investing in) the development or improvement of a product or process, where technological or scientific uncertainties are involved. The tax saving and associated cash flow benefit can be reinvested into the business and improve the financial performance.
Global research & development (R&D) tax incentives
Across most countries and industry sectors, a wide range of incentives are available to promote innovative activity and business investment. Typically, these will feature one or a combinationor more of the following:
• Cash Grants and/or loans
• Reduced tax rates or tax exemptions
• Enhanced tax deductions
• Repayable tax credits
• Additional tax benefits for protecting intellectual property, through patent-related incentives
• Payroll-related incentives
• Accelerated depreciation on R&D asset investment
In each jurisdiction, the applicability of the above features may vary depending on the facts and circumstances of the business. It is therefore important to be well advised at the R&D start-up phase or as early as possible to optimise any opportunities.
Kreston Global research & development (R&D) tax services
The range of opportunities to fund innovation can become very complex when you consider that within each country, local or regional governments may have the authority to fund and implement their own innovation strategy. Whether it is considering a cross-border R&D strategy or accessing incentives in a particular country, identifying and understanding the available options can therefore be a challenging and time-consuming undertaking.
Kreston has R&D specialists in a number of countries with a track record of navigating the complex matrix of available incentives in their jurisdictions. Our R&D specialists have assisted thousands of clients spot R&D opportunities and claim R&D tax incentives, these range from start-up businesses right through to mature groups of companies.
Advice and support from a local Kreston member may include:
• Identifying eligible businesses and qualifying activities, including any local definitions of R&D;
• Calculating the financial effect of any R&D activity;
• Assisting with any compliance requirements, such as registrations, filings with tax authorities and advising on deadlines;
• Advising of record-keeping requirements;
• Identifying further opportunities to make R&D claims;
• Advising on options to improve cash flow;
• Corporate structuring advice in respect of R&D companies,; and
• Planning for future investments and decisions.
The tax rules and requirements can be subject to regular change in each jurisdiction, so it is important that you have R&D advisers that are up to date and proactive in dealing with changing legislation.
Why choose Kreston Global?
Our network of advisors can assist businesses to identify, substantiate and realise significant tax savings for R&D activity, whilst considering the wider tax and financial position of the company or group. Our advisors will also work collaboratively to provide solutions to any cross-border R&D planning.