Breakfast Briefings - Funding R&D - November 2017
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Funding R&D: Inspiration, perspiration and (how to avoid) exasperation Breakfast Briefings: Autumn/ Winter 2017 7 th November 2017
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Transcript of Breakfast Briefings - Funding R&D - November 2017
Funding R&D: Inspiration, perspiration and (how to avoid) exasperation
Breakfast Briefings: Autumn/ Winter 20177th November 2017
pkf-francisclark.co.uk
Administration
pkf-francisclark.co.uk
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Presentations followed by discussion
Presenter Topic
Daniel Sladen
Director, PKF Francis Clark
How R&D benefits businesses and
maximising that benefit through
remuneration and legal planning for
tax credits
Josie Gough
South Regional Manager, Innovate
UK
Innovate UK: funding business
innovation
Jowanna Conboye
Intellectual Property and IT, Stephens
Scown
Protecting and using your R&D: an
overview of the intellectual property
landscape and how proper protection
can add to your bottom line.
R&D incentives
Daniel Sladen
Contents
• Overview of R&D incentives
• Qualifying activities
• Qualifying expenditure
• Complications
• Other things to think about
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pkf-francisclark.co.uk
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Who it’s for
• Companies carrying out qualifying research and
development
• Not available to sole traders/partnerships – consider
whether incorporation is worthwhile
• SMEs: R&D tax credit
• Large companies: R&D expenditure credit (RDEC)
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What it’s worth
• An extra 130% deduction against corporation tax
• Value approximately 25p in £1 if used to reduce tax
liability
• Or repayable tax credit worth 14.5p in £1
• RDEC: 11p in £1 (but taxable, so about 9p)
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What it’s not
• Based on income or profits
• Related to creating particular class of IP
• Driven by success (failures can be useful)
• Limited to “hi-tech” businesses
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What it is
• “A project…
• …that seeks to achieve an advance in overall knowledge or
capability…
• …in a field of science or technology…
• …through the resolutions of scientific or technological
uncertainty”
• Relief for expenditure on people, software and
consumables
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Uncertain?
• “Scientific or technological uncertainty exists when
knowledge of whether something is scientifically
possible or technologically feasible, or how to achieve
it in practice, isn’t readily available or deductible by a
competent professional working in the field”
• What are the uncertainties?
• How did you try to overcome them?
• Why was the knowledge not “readily deducible”?
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Expenditure in more detail
• Employment costs: costs of staff engaged in R&D
activity including NI, pension contributions, recruitment
costs
• “Directly involved” staff only – no allocation of admin,
back office, support
• Consider employment vs consultancy vs agency
• Consumables: heat, light and water, materials used
(unless subsequently sold)
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How to identify expenditure
• As accurately as possible . . .
• Reasonable, consistent, auditable methodology
• Identify the best allocation key
• Real-time data capture
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Subcontracting out
• R&D is carried out by a subcontractor on your behalf
• Claim limited to 65% of cost to you
• Different treatment for connected parties
• Election to treat as connected
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Subcontracting in
• For R&D carried out as subcontractor, may be able to
claim under RDEC
• Still based on expenditure
• Consider nature of relationship: are you delivering
R&D or carrying out R&D in order to deliver product?
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Grants and subsidies
• In many cases, RDEC claim is still possible
• SME claim could still be available where not all costs
are covered
• Complex area – need to review each case individually
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Owner-managed businesses
• Remuneration strategy could be affected if owners
involved in R&D activity
• Correlate remuneration with periods of more R&D
• Pension contributions become more valuable (subject
to usual caveats)
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Other things to think about
• Timing: two years to claim (if no claim has ever been
made, can effectively do three years at once)
• Advance assurance
• Success fee vs fixed fee
• Could patent box be useful too?
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Contacts
Daniel Sladen - [email protected]
Jackie Oddy - [email protected]
PKF Francis Clark Truro: (01872) 276477
(c) copyright PKF Francis Clark, 2016
You shall not copy, make available, retransmit, reproduce, sell, disseminate, separate, licence, distribute, store electronically, publish, broadcast or otherwise
circulate either within your business or for public or commercial purposes any of (or any part of) these materials and / or any services provided by PKF Francis
Clark in any format whatsoever unless you have obtained prior written consent from PKF Francis Clark to do so and entered into a licence.
To the maximum extent permitted by applicable law PKF Francis Clark excludes all representations, warranties and conditions (including, without limitation,
the conditions implied by law) in respect of these materials and /or any services provided by PKF Francis Clark.
These materials and /or any services provided by PKF Francis Clark are designed solely for the benefit of delegates of PKF Francis Clark.
The content of these materials and / or any services provided by PKF Francis Clark does not constitute advice and whilst PKF Francis Clark endeavours to
ensure that the materials and / or any services provided by PKF Francis Clark are correct, we do not warrant the completeness or accuracy of the materials
and /or any services provided by PKF Francis Clark; nor do we commit to ensuring that these materials and / or any services provided by PKF Francis Clark
are up-to-date or error or omission-free.
Where indicated, these materials are subject to Crown copyright protection. Re-use of any such Crown copyright-protected material is subject to current law
and related regulations on the re-use of Crown copyright extracts in England and Wales.
These materials and / or any services provided by PKF Francis Clark are subject to our terms and conditions of business as amended from time to time, a
copy of which is available on request.
Our liability is limited and to the maximum extent permitted under applicable law PKF Francis Clark will not be liable for any direct, indirect or consequential
loss or damage arising in connection with these materials and / or any services provided by PKF Francis Clark, whether arising in tort, contract, or otherwise,
including, without limitation, any loss of profit, contracts, business, goodwill, data, income or revenue. Please note however, that our liability for fraud, for
death or personal injury caused by our negligence, or for any other liability is not excluded or limited.
PKF Francis Clark is a trading name of Francis Clark LLP. Francis Clark LLP is a limited liability partnership, registered in England and Wales with registered
number OC349116. The registered office is Sigma House, Oak View Close, Edginswell Park, Torquay TQ2 7FF where a list of members is available for
inspection and at www.pkf-francisclark.co.uk. The term ‘Partner’ is used to refer to a member of Francis Clark LLP or to an employee. Registered to carry on
audit work in the UK and Ireland, regulated for a range of investment business activities and licensed to carry out reserved legal activity of non-contentious
probate in England and Wales by the Institute of Chartered Accountants in England and Wales. Partners acting as insolvency practitioners are licensed in the
UK by the Institute of Chartered Accountants in England and Wales. A partner appointed as Administrator or Administrative Receiver acts only as agent of the
insolvent entity and without personal liability. Francis Clark LLP is a member firm of the PKF International Limited network of legally independent firms and
does not accept responsibility or liability for the actions or inactions on the part of any other individual member firm or firms.
Disclaimer & copyright
pkf-francisclark.co.uk
Innovate UK:Supporting business-led innovation
Josie GoughSouth West Regional Manager
Activity Discovery & Research Innovation Commercialisation
TRL Description Basic principles
observed and reported
Concept or application formulated
Experimental proof of concept
Concept or process
validated in laboratory
System or component validated in
relevant environment
System model or
demonstrator in relevant
environment
System prototyping
demonstrator in operational environment
Actual System completed
and qualified test & demo operational
environment
Actual system mission
proven in successful
mission operationsSource: NASA Technology Readiness Level model
Academia Business
Funding & Support for Business Led Innovation
Where does Innovate UK funding go?
Data: 2015-16
60% businesses
20% researchers
20% RTOs
82% of collaborative projects involve research base partner
We work with >140 individual research base organisations (inc Institutes and RTOs)
Emerging
and
Enabling
Health
and Life
Sciences
Infrastructure
Systems
Manufacturing
and
Materials
Open
Programme
Closes NovReopens
March 2018
Open now –until
December 2018
Opens Jan 2018 – March
2018
Open now until 10th
January 2018
Open Dec 2018 – Feb
2018
Our competitions schedule includes programmes run with partners – more details on our webpage
Sectors approach to supporting businesses
Sept 2017Next sector competition
July 2017Next sector competition
Now open Shortly to close next one Nov
2017
Now open
Competition characteristics and processCore competitions, Industrial Strategy Challenge Fund, Other organisations funding, Small
Business Research Initiative, Knowledge Transfer Partnerships
• Competition design (inc. streams, in scope out of scope etc.) • Competition launch • Applications invited via new online portal • Usually single stage application • Usually need match funding though academic partners can get 100% • Single organisation applications for less than £100k otherwise
consortia • Deadline passes, assessors score and provide feedback • Average of the five assessors score • Ranked list & Portfolio review – assessment panel• Due diligence & Contracting • Money paid quarterly in arrears
IMPA
CT,
IMPA
CT,
IMPA
CT!
Investing in science, research & innovation
Upgrading infrastructure
Improving procurement
Delivering affordable energy & clean
growth
Driving growth across the whole
country
Developing skills Supporting businesses to start & grow
Encouraging trade & inward investment
Cultivating world-leading sectors
Creating the right local institutions
27
Industrial Strategy Challenge Fund• Industry-led and powered by multi-disciplinary
research and business academic collaboration.
• Develop UK industries that are fit for the future,
driving progress in technologies where the UK
can become a world-leader in research and
commercialisation
Industrial Strategy Challenge Fund
Knowledge Transfer Partnership
Knowledge Transfer Partnership
Strategic relevance to the business : IMPACT – Embedding of Innovation Culture
Stimulating and challenging for the academic team : CHALLENGE
Intellectually challenging for the Associate : INNOVATION
Sound business case : HIGH GROWTH POTENTIAL
Clear knowledge transfer: Innovate UK
Clear additionality: we want high level innovation,
and economic impact plus any societal impact.
Benefits likely to accrue: TO ALL PARTNERS
Funding Levels and position of KTP Projects
• >75% of projects are with SMEs (EU Definition)- 50% employ less than 50 people
- 15% are micro companies
• SMEs contribute 33% towards project cost - Company contribution is between £25-30k per annum
• Large companies contribute 50%- Company contribution is between £35-45k per annum
• Majority of KTPs sit in TRL 5-7 range
• Typical project is 24 months in duration (12-36 months possible)
• Highly focussed projects (TRL, Associate role)
Contact details for business facing staff for Innovate UK
• Andy Treen [email protected]
• Layla Burrows [email protected]
THE FOUR TYPES OF IP
Copyright
Trade Marks
Design Rights
Patents
Moral Rights
Goodwill
Passing Off
Database Rights
Unregistered
Marks
Unregistered
Designs
Trade Secrets
Websites
Get Up
Trade Dress
Service Marks
Business NamesDomain Names
Know-How
Unfair
Competition
Confidential Information
Patents
DESIGNS
Designs, continued
Trade Marks – the ‘badge of origin’
BRAND PROTECTION - TRADE MARKS
Unregistered Registered
TM ®
Automatically occurring Government endorsed monopoly
Difficult and expensive to enforce Certainty and Security
Company Name
Domain Name
Trading Name
COLLABORATION AND THE OPEN IP
SYSTEM?
OWNERSHIP
Who created the work?
Licence v. Assignment
The need for written agreements
WHAT THE FUNDS WILL LOOK FOR
What IP will you be creating
How can you demonstrate that you will own it?
What due diligence has been done to ensure that the IP does not
infringe the rights of third parties?
What steps have been taken to protect the IP?
What contracts are in place with those who have created IP?
Funding R&D: Inspiration, perspiration and (how to avoid) exasperationBreakfast Briefings: Autumn/ Winter 2017 – Wrap up: Tom Roach, Partner, Francis Clark7th November 2017
pkf-francisclark.co.uk
.
RDI funding and business support in CIOS
Next…
Q&A and/ or discussion
• With opportunity for Q&A for presenters
• Discussion
Future presentations
• “International trade” (5/12/17) – invite in pack
• Finance in Cornwall (18/4/18)
pkf-francisclark.co.uk
(c) copyright PKF Francis Clark, 2016
You shall not copy, make available, retransmit, reproduce, sell, disseminate, separate, licence, distribute, store electronically, publish, broadcast or otherwise
circulate either within your business or for public or commercial purposes any of (or any part of) these materials and / or any services provided by PKF Francis
Clark in any format whatsoever unless you have obtained prior written consent from PKF Francis Clark to do so and entered into a licence.
To the maximum extent permitted by applicable law PKF Francis Clark excludes all representations, warranties and conditions (including, without limitation,
the conditions implied by law) in respect of these materials and /or any services provided by PKF Francis Clark.
These materials and /or any services provided by PKF Francis Clark are designed solely for the benefit of delegates of PKF Francis Clark.
The content of these materials and / or any services provided by PKF Francis Clark does not constitute advice and whilst PKF Francis Clark endeavours to
ensure that the materials and / or any services provided by PKF Francis Clark are correct, we do not warrant the completeness or accuracy of the materials
and /or any services provided by PKF Francis Clark; nor do we commit to ensuring that these materials and / or any services provided by PKF Francis Clark
are up-to-date or error or omission-free.
Where indicated, these materials are subject to Crown copyright protection. Re-use of any such Crown copyright-protected material is subject to current law
and related regulations on the re-use of Crown copyright extracts in England and Wales.
These materials and / or any services provided by PKF Francis Clark are subject to our terms and conditions of business as amended from time to time, a
copy of which is available on request.
Our liability is limited and to the maximum extent permitted under applicable law PKF Francis Clark will not be liable for any direct, indirect or consequential
loss or damage arising in connection with these materials and / or any services provided by PKF Francis Clark, whether arising in tort, contract, or otherwise,
including, without limitation, any loss of profit, contracts, business, goodwill, data, income or revenue. Please note however, that our liability for fraud, for
death or personal injury caused by our negligence, or for any other liability is not excluded or limited.
PKF Francis Clark is a trading name of Francis Clark LLP. Francis Clark LLP is a limited liability partnership, registered in England and Wales with registered
number OC349116. The registered office is Sigma House, Oak View Close, Edginswell Park, Torquay TQ2 7FF where a list of members is available for
inspection and at www.pkf-francisclark.co.uk. The term ‘Partner’ is used to refer to a member of Francis Clark LLP or to an employee. Registered to carry on
audit work in the UK and Ireland, regulated for a range of investment business activities and licensed to carry out reserved legal activity of non-contentious
probate in England and Wales by the Institute of Chartered Accountants in England and Wales. Partners acting as insolvency practitioners are licensed in the
UK by the Institute of Chartered Accountants in England and Wales. A partner appointed as Administrator or Administrative Receiver acts only as agent of the
insolvent entity and without personal liability. Francis Clark LLP is a member firm of the PKF International Limited network of legally independent firms and
does not accept responsibility or liability for the actions or inactions on the part of any other individual member firm or firms.
Disclaimer & copyright
pkf-francisclark.co.uk
Agritech Cornwall
Elizabeth GilbertAgritech Business Engagement Manager
Cornwall Development [email protected]
[email protected]: 01872 322672M: 07483134989
52
53
AeroSpace Cornwall
Natasha Downing
AeroSpace Project Administrator
Cornwall Development Company
T: 01209 615567
54
Marine I
Doreen Gibbons
Marine I Challenge Fund Administrator
Cornwall Development Company
T: 01209 615091
A T I Innovation FundJohn Hutchings Innovation Fund Manager – Acceleration through InnovationUniversity Of PlymouthPool Innovation Centre, Trevenson Road, Pool, Redruth, Cornwall TR15 3PL M: 07860 756862 | E: [email protected]
