Research and development (R&D) is of paramount importance for anyone seeking success in the business world.
R&D skills allow us to find cutting-edge innovations which will set businesses apart from the competition.
When businesses succeed with innovative products or services, they contribute directly to increased gross domestic product (GDP). Additionally, these advancements often drive cutting-edge developments that enhance global efficiency or promote sustainability.
Governments worldwide recognise the critical role businesses play in fostering innovation, which is why many offer a range of incentives to support R&D initiatives.
As this article will explore, the benefits of investing in R&D are multifaceted, offering significant value not only to businesses but also to society as a whole.
1. Government Incentives
In Australia, the government provides the Research and Development Tax Incentive (RDTI). This incentive was created to promote company innovation and growth by offsetting some of the costs of eligible research and development. Research and development projects allow companies to make investments in knowledge, allowing for innovation that would usually be a slow process. Not only can these advancements transform markets and increase company output and overall GDP, but they can also result in large-scale improvements for society worldwide.
To qualify for the RDTI, both companies and their R&D activities must meet certain eligibility criteria.
Your eligibility for government incentives is affected by a range of attributes, such as your annual business turnover, your expenditure on R&D activities, and the details of those activities.
These criteria and the proper documentation must be met to receive your tax break.
2. Claiming Incentives
While R&D projects are constantly creating innovations and transforming markets and industries, accounting software is constantly changing too.
This, alongside the range of eligibility criteria, means that difficulties can arise when attempting to claim R&D tax breaks, which can be a huge detriment to any company that has planned around them.
The R&D Masterclass provides premium online courses that are kept up to date with all the information you need to ensure that you are eligible.
3. Examples of Success
The best way to prove the worth of R&D is to look at some examples of business success.
RayGen Resources is a provider of renewable energy. Using government incentives, they were able to pioneer a new renewable energy technology. Mirror collector technology can focus sunlight on a receiver which converts the sunlight into electricity and heat. This electricity and heat can then be used to store the energy.
This unique technology allows renewable energy to be dispatched at a far lower cost.
By taking advantage of the government tax incentive, RayGen Resources was able to employ highly skilled individuals which paved the way for this technology. Extensive research and development were required to prove the technology for a commercial environment.
Bugs for Bugs Pty Ltd has pioneered new non-toxic alternatives to chemical pesticides.
Scientists are increasingly looking for environmentally friendly ways of managing pests in the agriculture industry. Thanks to R&D incentives, Bugs for Bugs has become one of Australia’s leading providers of non-toxic substitutes for chemical pesticides.
R&D is an ongoing process, and Bugs for Bugs has consistently made improvements to their processes. Large R&D projects have been vital to identifying weaknesses and increasing production.
Capilano Honey has utilised R&D to great effect, creating industry-leading development methods for the packaging and flavour of honey.
R&D funding has helped the company grow. Capilano has transitioned from being a small family business to being an ASX-listed company that exports to over 33 countries around the world.
These R&D have increased quality control, sustainability and efficiency, while also resulting in a new range of honey blends and flavours.
With successes and innovations like these, it’s no surprise that governments invest in R&D. This diverse range of industries is only the beginning, as every business type has room for innovation and growth through research and development.
The R&D Masterclass
The R&D Masterclass provides specialised courses that assist businesses in beginning research and development projects while ensuring that they meet the criteria for government incentives.
Find out more about our online courses here
