The challenges of claiming R&D Tax Credits for plant breeders, Blackman Agriculture.
Fiscale have been working with Blackman Agriculture for a number of years, seeing them be literal leaders in their field, while developing high yielding and disease resistant varieties of wheat. It’s a time consuming and complex process, with each new strain of cereal taking years to develop. However, the team at Fiscale have thoroughly enjoyed getting to grips with the complexity of the research undertaken, to understand the pioneering work being conducted. It’s only when fully understanding these process that Fiscale were able to identify all the key elements that could be covered in a claim for R&D Tax Credit.
When it comes to plant science, the technical uncertainties must be managed through extensive analysis, testing and field trials. Fiscale were in no doubt from the outset, that Blackman Agriculture would satisfy the criteria set by HMRC for R&D Tax Credit eligibility. However, the challenge would be to articulate each of the uncertainties, along with explaining the impact that the diversity of characteristics, genetic sequences and the interactions between different plant strains have on new product development, before calculating a monetary value to that process.
To successfully claim Research and Development (R&D) Tax Credits for plant breeders, we need to demonstrate that our client were:
Producing new or improved products, processes or services
Designing and developing products that resulted in technological and scientific uncertainties
The biggest challenges that Blackman Agriculture face are related to uncertainties involved throughout the breeding process; these uncertainties start with determining the biological outcomes when crossing breeding plants – will one parent plant work with another? If so, what attributes will they inherit?
Disease resistance is a critical factor for any crop and is often the reason for developing a new breed to begin with. Uncertainties abound when anticipating the types of diseases that may develop in the future and in considering whether a new variety will be disease resistant. Climate change increases the scale and frequency of emerging plant diseases, throwing another unknown variable into the equation.
When considering that additional uncertainties arise with the environment where the grain will be grown, the different soil compositions, the previous crops grown on the land and how different climates will affect both the yield and the quality of the crop, you start to see just how many factors need to be taken into account. Each of these offer uncertainties which need to be overcome during the research and development (R&D) process.
Once these have been addressed, the wheat variety must be added onto the National List before it can be certified and marketed in the UK. Following the National Listing, if the variety meets the criteria of the Agriculture and Horticulture Development Board (AHDB), it will require a further year of testing and if successful be added to the Board’s Recommended List. One of the criteria required for this classification is that the wheat has “a 2% yield advantage compared to current varieties” or other compensating factors.
Since yield and quality are directly influenced by the weather, which is at best unpredictable, the testing phase for any new variety of cereal can last over several seasons and it can take years before a new variety is commercially available.
