How R&D tax credits can help your signage business
The signage industry is becoming more important than ever for brand exposure. The ability to reach out to consumers with non-invasive signage is an opportunity to get into the consumer’s psyche. This can ensure promotions and marketing campaigns have the desired impact. For brands to continue standing out from the crowd, signage companies must continue to innovate and never stand still.
We’ve recently looked at some of the most impressive digital signage trends around the world, with display technologies evolving at a rapid pace. To ensure signage companies have the headspace and resources to tackle the challenge of display technologies and the issues that surround them, be it energy efficiency or the clarity of visual effects, they must take advantage of research and development (R&D) tax credits that the UK government offers to innovators across a broad spectrum of industries.
Put simply, the idea surrounding R&D tax relief is that signage companies, and any other creative companies looking to advance their respective industries, can deduct the qualifying costs of their R&D from their annual profits. This can be a significant tax saving for some businesses.
How can your signage business qualify for R&D tax relief?
All your signage business needs to do is to prove that your research projects or investigations do the following:
- Try to deliver an advancement in science or technology
- Look to overcome an element of industry uncertainty
- Attempt a project that a fellow signage professional could not be easily replicate
Depending on the size of your signage business, your claim for R&D tax relief will fall into one of two categories:
SME R&D Relief
Signage businesses with less than 500 staff members and a turnover below €100m, or a balance sheet below €86m, can claim for SME R&D tax credits. Using this relief, signage businesses can subtract 130% of the total costs of their R&D project from their annual profits; this is on top of the standard 100% deduction. Signage firms with a profitable balance sheet can claim up to 26p for every £1 of R&D expenditure. Signage firms with loss-making balance sheets can claim up to 33p for every £1 of R&D expenditure.
Research and Development Expenditure Credit (RDEC)
Signage businesses with more than 500 staff members are required to submit R&D tax relief claims through the RDEC scheme. This amounts to tax credits of 12% of all qualifying expenditure on R&D projects and is also open to smaller signage firms that are subcontracted to complete an R&D project on behalf of a large company.
The UK government has set aside millions of pounds to encourage innovation. Industries like the signage industry can, therefore, invest time and effort in pushing the boundaries of what is possible.
Whether it’s digital menus in restaurants, giant AV systems or passenger communication signage at train stations, R&D tax credits incentivise firms looking to create more impactful, safer and energy efficient digital signage across the country.
Arrange a free consultation with our team of experienced and approachable tax incentive advisors today. At Kene Partners, our mission is to help innovative companies access millions of pounds of government money set aside to foster innovation. Your business could be next.