Overview
Qualifying at a Glance
To qualify for R&D tax relief in the food & drink industry , projects must aim to resolve scientific or technological uncertainties, leading to an advance in the field. Examples of such activities in the Food and Drink industry include:
- Innovative Processing Techniques – Implementing new methods for food preservation, such as novel freezing or canning processes, to extend shelf life while maintaining quality.
- Sustainable Packaging Solutions – Designing packaging that improves recyclability or biodegradability, or that extends product shelf life, may require overcoming material science challenges.
- Process Optimisation – Enhancing manufacturing processes to increase efficiency, reduce waste, or adapt to new equipment, especially when scaling up from small-batch to mass production.
- Supply Chain Innovations – Developing innovative sourcing processes, especially in response to supply chain disruptions, to ensure consistent quality and availability.
Non-Qualifying Activities
It’s important to note that not all activities qualify for R&D tax relief. HMRC does not consider the following as eligible:
- Routine adaptation of recipes to cater to vegan diets – Modifying existing recipes to replace animal-derived ingredients with readily available plant-based alternatives does not address significant scientific or technological uncertainties, is considered routine adaptation and does not qualify for R&D tax relief.
- Standard Recipe Adjustments – Minor changes to ingredient ratios or substitutions that do not involve scientific or technological uncertainty.
- Aesthetic Enhancements – Modifications aimed solely at improving taste, appearance, or branding without addressing technical challenges.
- Market Research – Activities focused on consumer preferences or market trends without a component of scientific or technological advancement.
- Compliance with Existing Standards – Efforts to meet established regulations or standards without developing new processes or products.
You are in a strong position to qualify for R&D claims if you have:
Ask Yourself
- Did you conduct R&D activities to develop new products, processes, or services or to improve existing ones?
- Did the R&D activities involve the resolution of technical uncertainties or challenges that could not be solved by using existing knowledge?
- Did your products or services require extensive trial and testing throughout the creation process?
If you are answering yes, you may qualify to claim back up to 27% of eligible R&D expenditure through HMRC’s R&D Tax Relief Initiative. Contact one of our R&D tax credit specialists to seek further advice on how to proceed with your R&D claim.
The claim process
We understand the complications that can often arise when completing an R&D claim, not to mention the significant amount of time it can consume, diverting your attention from driving your innovation forward. That's why we have streamlined a transparent and hassle-free process that follows a step-by-step approach from start to finish.
Throughout your R&D claim process, we maintain open lines of communication tailored to your preferences. Once we have compiled comprehensive technical and financial reports, we take the responsibility of submitting them and proactively follow up with HMRC, leading the communication on your behalf. Often, our next contact with you brings the exhilarating news of success and positive outcomes.
Step 1
We'll gain your authorisation via our client instruction form/NDA. This will enable us to discuss your R&D activities along with your current tax position.
Step 2
We'll analyse the profit & loss (P&L) statement of the business while facilitating your technical call. This step aims to determine whether your case is feasible from both technical and financial perspectives.
Step 3
Once our experts are confident that your case meets the R&D eligibility criteria, we will then gather all the required technical information and financial documentation according to HMRC's standards to support your case.
Step 4
At this stage, we initiate a stringent compliance procedure that we have developed in-house to audit your R&D claim application. We verify whether it meets the defined standards before submitting it to HMRC to ensure a positive outcome.
Step 5
After conducting a comprehensive review of your R&D claim, including all required documentation, the application will be forwarded to HMRC for further processing.
Step 6
Our team maintains continuous contact with HMRC regarding your case. If any queries arise, we address them on your behalf using a highly systematic approach to maximise your outcome while minimising any delays in your repayment.
