Within the latest HMRC statistics on R&D tax credits, we can see that only 0.58% of all claims made under the SME scheme, were for companies operating in the Water, Sewage and Waste sector.
The average claim value is £40,816.
The waste, water and sewage sector covers a wide range of business types. As a result, companies within this field will often find it necessary to engage in a broad range of research and development (R&D) activities, depending on each new project that they embark on.
Producing new or improved products.
The design and development of a product involving some degree of uncertainty for which the answers were not obvious.
We often find that companies are doing qualifying R&D, in the designing and manufacturing new components. These could be used for delivering water or waste from points A to B, or by developing new treatment processes, which are needed for clean and safe drinking water.
Trial and experimentation will often be needed when selecting which materials to use, for new products or components. The reason being that these will play an integral role in the structural stability of the end product. Some materials will be unsuitable for the task at hand; for example, they could be unable to withstand specific pressures. Sometimes a material will be incompatible for the build because it can directly conflict with other materials that are in use.
It’s not uncommon for new components to work as expected while being developed, but when assembled will act very differently. As it’s only when all of the components are pieced together, that companies can fully test the product, it’s this integration phase that can contain many technological uncertainties that will need to be tackled.
Any slight alteration can directly impact the chemical or physical properties of the product; for example, the pH or concentration. As a result of this, there’s often a great deal of research and development taking place while creating new formulas.
When developing or adapting products to work under different conditions than they were originally intended, further technological uncertainties can arise. Some materials can react adversely to one another, or can react to any new components that have been introduced to the system. When unexpected issues like this arise, they will directly impact the way that a product acts. As a result, these require more trial and experimentation to ensure their suitability.
Why not contact us today to discuss your business’ R&D tax relief? It only takes our team around 20 minutes to determine if you are eligible or not.