R&D tax relief can fuel growth in renewables
The UK’s renewable energy sector continues to adjust to the post-subsidy environment.
31 August 2018
The UK’s renewable energy sector continues to adjust to the post-subsidy environment. The ending of onshore wind farm subsidies in 2016 and the closure of the renewables obligation (RO) mechanism for new solar capacity a year earlier has significantly affected financing within the sector. Earlier this year it was reported that investment into these areas of renewable energy fell by 56 per cent in 2017.
With the last Budget ruling out any fresh support for the sector before 2025, it’s more crucial than ever for operators to leverage other means of government support. For some companies, research and development (R&D) tax credits could offer a helping hand when they most need it.
Introduced by the UK Government in 2000, R&D tax credits have been an excellent measure in driving forward competitiveness in British business by incentivising companies to invest in innovation in return for tax breaks. For every £100 of qualifying R&D expenditure, relief is available at £25.00 for profit-making SMEs and at £33.35 for those making a loss.
Many wind and solar energy businesses push technological boundaries on a daily basis. Whether it’s prototyping, development or experimentation with materials or physical production processes, there’s a wide variety of disciplines involved in advancing the science responsible for energy production, all of which could qualify for substantial tax rebates.
Article originally published on Energy Voice
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