Innovation 2020: What’s It All About?

Socially, economically and politically, the Republic of Ireland has reinvented itself many times across the last three generations in particular. No longer does it risk being regarded as one of the world’s economic backwaters, despite well-documented challenges over the years; far from it. Those days are long gone, and Ireland is now leading the way in scientific and technological research and innovation.

Launched in 2015 and set to run until the end of this year, Innovation 2020 has for five years represented the Irish government’s drive for innovation. It’s been about enhancing R&D, science and technology, and recognising where investment can be made to ensure Ireland continues to be a strong and thriving economic powerhouse. Already some big names in global high-tech industries have made Ireland their home, including the European headquarters of Google and PayPal, Pfizer, Unilever, Apple, Smurfit Kappa and many more.

Ireland may be small, but it packs an innovative punch

Ireland is geographically a country on the smaller side, particularly in comparison to its European neighbours and larger countries like China and the US. The Irish government is aware of this fact, and understands that to remain competitive it needs to employ more people, invest in more innovation, and become an even more attractive place for the global workforce to come and settle. Any kind of insular thinking just won’t work - it’s about diversifying products, building new companies, expanding the job roles on offer and attracting new talent. It’s also vital to maintain the existing talent Ireland already has, by nurturing wealth creators, students, scientists, technologists and researchers.

Innovation 2020 sets out how Ireland can meet its targets in this area effectively. It looks to support various initiatives, focusing on jobs, talent, scientific excellence and innovation, to not only boost economic prosperity but social prosperity too. In doing this, it has looked to make a better society, with a more positive outlook that’s attractive to the rest of the world.

It’s not just about money

The benefits of Innovation 2020 are not just about boosted revenue, but also about having the chance to work with companies all over Europe to address common challenges in society. Being a small island nation this is incredibly important, especially in an unchartered post-Brexit world. Building the population’s knowledge and skill base from school-aged children to university graduates and those firmly established in their career, Innovation 2020 focusses on how to realise an individual’s potential for the benefit of society as a whole.

What were/are the key goals of Innovation 2020 for Ireland?

There are many goals and aims for Innovation 2020, and when we look back on the strategy from next year onwards we can then decide if it was successful. The signs however are good, with outstanding research already being performed in areas of particular social and economic importance. One of its goals is to maintain Ireland’s position as a strong economy that can effectively compete in global markets by boosting its sales, exports and employment - again it is succeeding here. Another goal is about sharing knowledge and benefitting from the innovation of other companies both in Ireland and further afield. This will also make Ireland more open to new opportunities, attracting the very best talent from around the world (another key goal). Finally it aims to build a renowned pool of talent in industry as well as across universities and in the public sector, and work out ways to exchange talent between them.

What is the SFI?

The Science Foundation Ireland (SFI) was set up specifically to encourage investment in engineering and scientific research. It aims to encourage young people in particular to engage in science, technology, engineering and mathematics (STEM), and looks at the challenges faced by people wishing to pursue a career in these areas. The SFI recognises that without a ready source of good quality talent coming through the ranks of STEM, the future prosperity of Ireland will suffer. Investing in this way means that the Irish workforce can be more adaptable to global challenges going forward, as well as serving to drive innovation.

How R&D tax relief can help meet the costs of company innovation in Ireland

Innovating and growing is expensive. Finding the money to reinvest in research and development (R&D) work can be a real challenge, especially for small companies and those that are just starting out.

The R&D Tax Credits scheme was launched by the Irish government in the early 2000s and serves to recognise this. It helps by offering a rebate on a company’s Corporation Tax bill to help finance innovative work a company has undertaken. A cash lump sum may also be offered, and it’s open to all Irish companies in all sectors.

The credit is offered at 25% of eligible expenditure, and can help to pay for things like staff wages, prototypes, testing, software, materials and more. This can run into the thousands, so claims can be substantial and submitting an application to the Revenue must therefore be optimised. Understanding the very specific claim requirements however can be extremely challenging, and it’s easy to miss details out or make a mistake - one which could be stressful and expensive in the future, especially if a Revenue investigation is launched.

Find out more by talking to the experts at Tax Cloud

When it comes to R&D Tax Credit applications, it’s vital that your claim is maximised, plus completely accurate to avoid a Revenue investigation. This is where we come in.

Developed by our highly-skilled team of accountants, consultants and specialists at Myriad Associates, the Tax Cloud portal can help Irish businesses and accountants make a succesful claim.

If you wish to ask a question or discuss anything to do with R&D Tax Credits in Ireland, speak to us today on +353 1 556 2001 or use our contact page.

Author Barrie Dowsett, ACMA, GCMA CEO, Tax Cloud