BFA Partner Innovation Tax is solely devoted to helping companies access government funding in the form of grants and tax incentives. Here, we spoke to Innovation Tax Director, Sachin Chauhan, to get answers to your frequently asked questions.
Navigating the complex area of footwear business funding opportunities and applications can be a daunting and time-consuming process, regardless of whether you’re an industry giant or an early-stage startup or SME.
Identifying the funding opportunities your business qualifies for can be a challenge, let alone the mammoth task of applying for these without any outside support. Unfortunately, when it comes to our sector, while there are many footwear business funding opportunities available, there seems to be a lack of understanding within the industry regarding how to apply for financial support and where to find it.
This is where companies like Innovation Tax come in. Having recently joined the BFA as a Partner, it offers Members clarity and support when it comes to funding. With a team of experts spanning aerospace, biotech and footwear, they can provide specially tailored advice for businesses of all sizes and shapes. In addition, they will work with you from start to finish, streamlining the application process and compiling your claim.
In order to demystify the complex process of funding and to learn more about what Innovation Tax can do for you, we sat down with Director, Sachin Chauhan, to find out more.
In terms of footwear business funding, are there more opportunities available than our Members might think? Is there a lack of awareness of what is accessible to companies large and small?
There is a wide range of funding available for businesses in the footwear sector. For example, there are tax incentives for investment in R&D, enabling companies to recoup up to a 1/3 of their investment on qualifying activities; Intellectual Property relief via Patent Box, which reduces corporation tax to 10% on profits from patented inventions, to Capital Allowances where, in our experience, only 4 in 10 companies are claiming their full entitlement. And there are also various national, regional and local Grant Funding opportunities available for investment in machinery, sustainability, and new product development.
However, given the range of funding schemes and administering organisations, we find that many SME businesses, especially owner-managed ones, simply do not have the time available to know what’s out there and what funding they may qualify for. A meeting with a holistic funding advisory company such as Innovation Tax can save a company considerable investment in time and resource in identifying and supporting the application/claims process.
For those who haven’t come across Innovation Tax before, what do you specialise in, and how can you help BFA Members?
Innovation Tax helps companies assess their entitlement to new and existing support measures and assist with funding applications. The main support areas are R&D Tax Credits, Capital Allowances, Patent Box, and Grants. Businesses will benefit from free advice, support, and guidance with practical and actionable assistance from our team. If an opportunity to claim funding is identified, fees will be calculated as a percentage of the benefits businesses receive.
What would be your advice to SMEs that want to see what funding options are available but need help knowing where to start?
A short introductory call will allow us to understand the requirements of the business and discuss what type of support would be suitable – this is often invaluable. In addition, our experienced team of technical and taxation specialists, many of whom have technical or research backgrounds across multiple industry sectors, enables a holistic understanding of the range of support available and, as such, can quickly scope and provide actionable advice to all businesses.
Your recent BFA Webinar focused on R&D Tax Credits, Capital Allowances, Patent Box and Grants. Is one of these more challenging to navigate than the other? Should SMEs have specific information or processes before embarking on these routes?
Each of the services discussed during the webinar is very different; the most challenging part of the process is when businesses initially look at qualifications to establish if any of the activities being carried out or due to be carried out are eligible for support. We make this process easy for businesses by carrying out a holistic assessment to identify activities for which they are likely to qualify.
- R&D Tax Credits enable businesses to recover up to 33% of costs invested in compliant activities such as developing new products (or improving existing ones), software and system development, improving manufacturing/production processes and trialling new (or alternative) development methods to seek improvements. R&D can apply across various sectors, including software, manufacturing, engineering, agriculture, construction and many more.
- Capital Allowances enable taxpayers to obtain tax relief on any capital expenditure they incur. Companies or individuals who own an existing commercial property (or are in the process of buying one) or who have undertaken extensive property improvement works would be highly likely to qualify for additional relief over and above amounts that may have already been claimed.
- Patent Box enables businesses to obtain significant tax savings from income derived from patented products (and processes) by applying a reduced corporation tax rate of just 10% on qualifying IP income.
- Grants provide a valuable source of Government support for businesses across a wide range of sectors. Examples of activities supported by grant funding are innovation, expansion, capital investment, sustainability and many more.
How do you work with businesses individually to help them succeed? And what are some of the best places or websites for advice?
We start with an informative explanation of each service and then establish which form of funding would be relevant for their business. Once an opportunity is identified, we tailor our approach and claim methodologies to suit the business so we can complete the claim/application in the most time-efficient manner whilst maximising the support available. Here are links to some websites which contain further information on R&D Tax Credits, Capital Allowances, Patent Box/Intellectual Property and Grants.
- A holistic view of all services: Tax specialist – R&D Tax Credits | Innovation Tax UK
- Innovate UK Grant Competitions: Innovation competitions – Innovation Funding Service (apply-for-innovation-funding.service.gov.uk)
- List of funding and support available from the Government: Finance and support for your business – GOV.UK (www.gov.uk)
Does the current cost of living crisis and rise in business expenditure impact the benefits BFA Members can achieve by working with specialists such as yourselves?
Over the past few years, businesses have had to navigate many uncontrollable ‘Black Swan’ events which have taken place, causing disruption and uncertainty and placing significant pressures on a company’s cash flow. As the current economic crisis is forecast to continue throughout 2023, we urge all members to review their entitlement to the current range of Government support available. Even if businesses are already benefitting from some services, having Innovation Tax give you a complimentary second opinion is always a worthwhile exercise.
Are there any new grants or options for funding that have emerged recently worth mentioning to BFA Members?
There are many new grants for capital investment projects, such as the purchase of machinery and equipment. Examples are included below:
- Business Growth Grant from the Growth Hub (bizgateway.org.uk)
- Business Growth Programme – LEP | Business support and finance (the-lep.com)
- Business Growth Programme 2 | Birmingham City Council
- Duplex Investment Fund (CWRT.uk.com)
- Invest to Grow funding – Funding and support programmes – University of Derby
- Capital Funding | Support for Business | The Growth Fund
Finally, if you could only offer one piece of advice to BFA Members about footwear business funding, what would it be?
We would urge all members to contact BFA or Innovation Tax to book an exploratory meeting, usually lasting 15 minutes over Teams or Zoom, to establish if their business would be eligible for any additional support, either from Tax Incentives administered by HMRC or Grant Funding administered by LEPS/Councils and national Government organisations such as Innovate UK.
Find out more about Innovation Tax via the brand’s BFA Member profile. To feature on the BFA Footwear News Blog, please contact us. Be part of our community. Join the BFA today as a business or individual.