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Printing & Packaging

R&D Tax on Printing & Packaging

Printing and packaging businesses can sometimes be unsure about their eligibility for an R&D tax credits claim, but at randd we are here to provide you with clarity.

This is an industry that requires ongoing innovation by companies in order to prosper. Digital printing is the key growth area, notably due to the manufacturing sector’s use of packaging and product labels spurring increased demand.

Online printing operators are becoming dominant in the short-run printing market, while technological developments have enabled companies to offer a wider range of products and services.

When innovative projects are undertaken, an R&D tax credits claim can result in sizeable benefits for a business by way of mitigating losses incurred in research and development via a cash reimbursement or a reduction in its Corporation Tax bill.

What qualifies as R&D tax on printing and packaging?

Projects which can be eligible for inclusion within a printing and packaging R&D tax credits claim include:

  • Overcoming printing challenges, for example in regard to temperature, pressure or wastage
  • The trialling of new techniques, for example to improve printing quality, ensure compliance with environmental legislation, improve the recycling and re-use of materials or energy optimisation
  • Improving print efficiencies in relation to colouring
  • Conducting printing trials
  • Developing new processes, for example the application of nanotechnology to printing
  • Reducing wastage and consumption of hazardous substances via new processes

What activities can be included in an R&D tax project for printing companies?

  • Producing prototypes and visuals for customers
  • Developing cost-efficient processes and products to satisfy client demands whilst retaining or improving quality
  • Testing environmentally friendly processes and recycled paper for colour matching and stability
  • Implementing new software and methodology
  • Creating bespoke solutions
  • Making improvements in energy efficiency and waste management
  • Time spent researching and developing
  • Investment in failed projects or developed products that are never launched or used

What expenses can be claimed as R&D tax?

  • Staff costs – Employee costs (salary, National Insurance and employer pension) are apportioned for their time spent working on the R&D project plus any reimbursed associated business expenses
  • Subcontractor costs – You can claim 65% of what you paid a subcontractor hired, for example, on account of their technical expertise
  • Software – Purchased for R&D purposes and costs apportioned for any subsequent use
  • Utilities and Consumables – Water, fuel, power and materials used in the project, provided the latter cannot be re-used for any other non-R&D purpose
  • Prototypes – Produced for R&D purposes

Printing and packing businesses we’ve helped to claim R&D tax credits

With help from randd, a printing company’s latest claim of £69,000 increased their R&D tax credits relief to £340,000 over five years.

The company designs, develops and manufactures bespoke point-of-sale displays created to enable clients to sell more products. Using various manufacturing techniques and materials, the company is geared up to be able to fabricate even the most complex requirements in-house.

Rather than rely on subcontractors, the company takes innovative approaches in many diverse and inter-related areas and processes that achieve improved quality, functionality and performance for point-of-sale displays. These include developing and prototyping, laser cutting, vacuum forming, injection moulding and metalworking.

The managing director of the business said:

“We are very pleased with the efficient service provided by randd for our recent R&D claim. Their information-gathering matrix was useful and enabled our claim to be processed with minimum delay. This was the sixth year we have used randd and we would highly recommend their services.”

Expert support for R&D tax on printing services

If you have any questions about printing and packaging tax relief or need advice about how to make a claim, call randd on 01332 409 711 and we will be happy to help you.

We have a proven track record of claiming back thousands of pounds in tax for clients in the printing and packaging industry.