Investing in R + D: tax advantages and subsidies

For small and medium manufacturers, the idea of ​​opting for R&D can be a major headache. On many occasions, if your range of products works, getting involved in projects of this type seems not very profitable, since they are usually associated with high costs that may be difficult to make profitable, if they are not carried out properly. As a result, it may be the case that small and medium-sized manufacturing companies are not aware of the existence of subsidies and aid of this type.

In this sense, Spain is one of the countries with the most tax advantages when investing in this type of project. These advantages are fundamentally based on two sources of financing: subsidies and tax deductions. The Spanish R & D deduction system is one of the most favourable in the world, reaching up to 42% of direct expenses. This system has many virtues, such as that these deductions are applicable to any sector, are not subject to competitive competition and have an immediate financial effect on the annual balance of each company. In addition, the deductions generated but not applied can be used in subsequent years, with even a case of monetary advance if certain conditions are met.

Within the R & D block there are three main types of projects: research, development and technological innovation. The first two are those in which the new knowledge or development obtained must represent a scientific-technological advance for the sector, with deduction percentages of up to 25%. These projects tend to be large, where research has a greater weight. On the other hand, it is in technological innovation projects where small and medium-sized manufacturing companies have more opportunities to take advantage, since the new development must in this case involve a significant technological improvement for the company itself, not for the entire sector. It is obvious that this type of project is of a scale much more in line with the interests of an SME, since its applicability is much more direct and its development times are much shorter (months, in most cases). The deduction percentages in these cases go up to 12%.

In addition to tax deductions, there are also subsidies that encourage R & D, both at the community and state level. One of them is the InnoCámaras program, an initiative of the Spanish Chamber together with the Chambers of Commerce, with financial support from the European Regional Development Fund (ERDF). It is an initiative that aims to contribute to improving the competitiveness of small and medium-sized companies, promoting a culture of innovation. The program has several phases, a first one of specialized advice, where professionals from the sector will evaluate in which aspects the competitiveness of the company can be improved in terms of innovation and a second phase of implementation of the projects defined in the first phase. The first phase is completely free, while in the second phase, 80% of the project budget can be financed.

Within the assumptions contemplated when requesting these grants, the services provided by DPO FLUID fit perfectly, so the manufacturing company could benefit from them to carry out these projects with us. Both the design of new prototypes by computer and the automation of manufacturing processes are innovative solutions that improve the competitiveness of the company in a quantifiable way. In addition, in this way you avoid making large investments or hiring your own staff to carry it out, one of the main obstacles to betting on technological innovation.

If you want to know more about this type of benefits and assistance, do not hesitate to contact us. We will be happy to help you to be more competitive today and always.