Pictured at the R&D seminar in Shannon (from left): Aisling Dooley, Principal Officer, Revenue; Ian Collins, Partner & Head of Innovation Incentives, EY Ireland; Leanne Storan, Tax Partner, EY Ireland; Helen Downes, CEO, Shannon Chamber; Clare Wardell, Assistant Principal Officer from Revenue, Business Taxes Policy & Legislation Division; and Fiona Gilchrist, R&D Strategy Lead with Jaguar Land Rover. Photo by Eamon Ward.
Research & Development (R&D) incentives are a great opportunity to help companies grow their business, invest in innovation, and create new products and services, according to a leading financial expert.
Addressing a recent Shannon Chamber seminar on R&D, Ian Collins, Partner and Head of Innovation Incentives at EY Ireland, said that any company doing something that is innovative should not overlook applying for R&D support.
“If firms are exploring how to improve yields, products and services, they should definitely check out what’s available,” Mr Collins said.
“Recent changes to Irish tax legislation, allowing for cash refunds as well tax credits, have also made R&D incentives even more attractive. If you’re failing to apply for these cash reliefs, you are losing out, money-wise, in a very real sense,” he added.
Together with Leanne Storan, Tax Partner at EY Ireland, Mr Collins outlined the range of incentives and opportunities for R&D activities available from the Irish Government and through the EU Horizon Programme.
In 2021, €770 million in tax credits was claimed by over 1,600 Irish firms as part of an overall spend of €4.7 billion in Ireland on R&D by businesses, Government and higher education.
Officials from the Business Taxes Policy & Legislation Division of Revenue outlined changes to the R&D legislation introduced in the Finance Act 2022 at the seminar. Principal Officer, Aisling Dooley and
Assistant Principal Officer, Clare Wardell explained that companies now have the option of claiming support via cash refunds on a 3-year instalment basis or as a tax credit against corporate tax (CT) liabilities.
Another significant change is that pre-trading R&D expenditure is now refundable in three annual instalments from the first accounting period that a company begins to trade. Previously, the amount could only be carried forward and used against CT liability in future periods. The Revenue speakers also outlined transitional arrangements that are in place as the new regime commences.
Introduced following public consultation, the 2022 legislation aims to ensure Ireland remains competitive in the context of upcoming changes to the international corporate tax regime.
Fiona Gilchrist, R&D Strategy Lead with Jaguar Land Rover, R&D Software Engineering Centre in Shannon, outlined the company’s extensive research & development activities, centred on connected, autonomous and electric vehicle engineering projects.
Commenting on the event, held at the Future Mobility Campus. Shannon Chamber CEO Helen Downes said that R&D is a critical part of successful business growth, which the Chamber is eager to promote at every opportunity.
“Shannon Free Zone and the Region generally has a proud record in this field over the years. We believe the information and guidance offered at the seminar can help, in a very practical way, to ensure that local firms can maximise the lucrative benefits on offer in the future,” she added.