Your trusted adviser for R&D Tax Credits and R&D Grants

R&D Tax Credits and Manufacturing Explained

Driving down costs, meeting efficacy challenges and making products and processes more sustainable are massive reasons to invest in and prioritise R&D if you're a manufacturer.

Barrie Dowsett

Chief Executive Officer


4 minute read

Research and development (R&D) is a great way to promote growth in your business and stimulate the Irish economy. Many companies relish the financial injection that R&D tax credits offer them, allowing them to build R&D into their growth plans and take some of the strain off, especially with riskier projects.

Manufacturing companies are especially likely to benefit from R&D tax credits, with the constantly changing pressures of industry standards and consumer demands, as well as numerous other factors that contribute to the necessity for R&D in the industry. Driving down costs, meeting efficacy challenges and making products and processes more sustainable are often significant reasons for innovation, alongside the stringent safety and usability legislation that accompanies many sectors of manufacturing. Challenges in the field are common, but R&D can help overcome them and it can come with a substantial tax credit.

Which areas in manufacturing are likely to require heavy investment in R&D?

Manufacturing is a fantastic catch-all for anything that’s made on a large scale, a prolific industry in Ireland. Some of the areas in manufacturing tend more towards innovation than others. In our experience, here are some of the top Irish manufacturing areas that invest in R&D:

  • Medical Devices
  • Pharma/BioPharma
  • Food and Drink
  • Engineering
  • Packaging
  • Plastics
  • Electronics
  • Automotive
  • Industrial Machinery
  • Construction

R&D tax credits are part of the Irish government’s efforts to encourage innovation and build on Ireland’s strengths. Offering significant tax refunds and credits allows companies to continue their R&D endeavours with less pressure from the balance sheet.

What are the potential barriers to innovation in the manufacturing sector?

With our in-depth knowledge of the field, we have identified various areas where R&D potential may be stunted:

Linking innovation and growth

Coming up with new ideas might come easily to your team, however translating those lightbulb moments into a meaningful product, process or service isn’t always the easiest thing. SMEs may not have access to the financial support, talent or technology to implement new techniques and drive growth in the company.

Stagnant company culture

Following a period of hardship, it’s difficult to find many that are willing to jump into a risky situation. In a country that runs on family-run, small businesses, many workforces are less likely to want to rock the boat and this lack of innovative spirit can hold companies back.

Grasping new technologies

Artificial intelligence, 3D printing, big data and robotics are all becoming more and more accessible, however, many companies may feel intimidated by these technological advances and are thus not fully exploiting the potential of the digital age for growth. Whether for reasons of lack of funds or lack of confidence, businesses could be at a disadvantage if they don’t move with the times.


Another barrier to innovation may be the trouble businesses have finding the correct talent. Some manufacturing sectors are incredibly niche and, despite Ireland’s dynamic young workforce, hiring choices may be difficult. Recruiting, training and then retaining the best talent is a huge part of making an innovative culture, which is no mean feat.

How do manufacturing companies compare to others claiming R&D tax credits?

Manufacturing companies are often focusing more on development than research (with the exception of the medical field). These companies are often making appreciable improvements to existing products, materials or processes. Fortunately, R&D tax credits are not just for companies reinventing the wheel, but for those refining it too.

If your project navigated technical uncertainty from the beginning and results in a new or an appreciable improvement to a product, service or process, then you will likely qualify for R&D tax credits. Even better, ongoing projects and even failed projects are still eligible for R&D tax credits, so long as they meet the requirements. Design work and feasibility studies can also qualify if they were in the aid of a technological advance.

What could you be entitled to with R&D tax credits?

This Revenue-backed scheme offers tax relief to Irish companies who are operating in the Republic or the European Economic Area (EEA) and is not eligible for an R&D tax deduction in another country. The company must be undergoing R&D activities to qualify, but the sector doesn’t matter, so long as a scientific or technological advancement was taking place. We have found that many believe that R&D tax credits are only available for multinational companies or lab-based projects, but most claimants are small and medium-sized enterprises.

Revenue currently offers a 25% tax credit, to be offset against a company’s Corporation Tax liability, in addition to a 12.5% tax deduction. R&D projects could mean your company is entitled to €37.50 per €100 spent on qualifying R&D expenditure. If your business is not required to pay Corporation Tax for this year or the year prior, the tax credit can be received in three equal instalments over three years or used against future tax liabilities.

Get in touch with Myriad Associates to find out more

Myriad Associates are experts in the field of R&D tax credits, with a 100% success rate over 16 years. Although generalist accountants will know your general tax position, we exclusively deal with innovation funding and we know the parameters down to the letter. Our expertise allows us to secure your entitlement and maximise the claim too.

Give us a call on + 353 1 566 2001 or use our contact form to get in touch with our friendly staff for professional advice.

Get in touch

Please contact us to discuss how working with Myriad Associates can maximise and secure R&D funding opportunities for your business.

Contact us

Related articles