North Ayrshire Council is in the enviable position of being on of the few areas within the United Kingdom to be designated as an Assisted Area thus qualifying for the full range of government support. While the availability of support is important in attracting companies to an area of almost equal importance is the support and help that is offered in accessing these funds. Part of the North Ayrshire Advantage therefore is the expertise that the Economic Development Services Team can offer in

•	Helping to source and advise on the best financial package that may be available to a company
•	Introductions to various financial institutions
•	Liaison with various funding bodies and professional advisers

The Economic Development Services Team can also liaise with other public bodies to secure any additional funding that may be available to a specific project.

The pull down menu below provides further details on the main sources of funding that may be applicable to a new investor or secondary expansion

Regional Selective Assistance
SMART
SPUR
Research and Development Assistance – Tax credits
UK Steel Enterprise
WOSLF

REGIONAL SELECTIVE ASSISTANCE – RSA

RSA is a national grant scheme, aimed at encouraging investment and job creation in the areas of Scotland designated for regional state aid under European Community law (the Assisted Areas). North Ayrshire is one of these qualifying areas.

To be considered for assistance, a project must meet the following criteria:

•	Location – it must take place in an Assisted Area.
•	Jobs – the project must directly create or safeguard jobs. Assistance will not be given where it leads to job losses elsewhere in the Assisted Areas.
•	Investment – it must involve an element of capital investment.
•	Viability – the project must make commercial sense, and contribute to the national economy.
•	Need – the project must need RSA to enable it to proceed as envisaged. RSA can be used to influence the location of a project to Scotland, make projects bigger, better or happen sooner.
•	Other funding – the majority of project funding must come from the private sector.

Eligible project costs can include investment in

•	Land and buildings
•	Plant and machinery
•	Software and intellectual property (IP)

Levels of grant are negotiated individually, and will depend on the scale of the project and the need for assistance. Most grants represent about 10-20% of project capital expenditure. These grants generally work out between £5,000 and £10,000 per eligible job, with more for higher quality jobs.

For projects involving relatively low levels of capital investment, assistance can be calculated against the first 2 years’ salary costs of new project jobs.
RSA is not limited to a single grant, and can be awarded for subsequent expansion projects.

For more information and application forms please click here

SMART

Smart aims to stimulate the creation of new, innovative businesses and to help existing small businesses improve their competitiveness by developing new products and processes to the benefit of the national economy.

Assistance is provided in 2 stages.

1. The first of these is competitive and assists individuals and small firms to carry out a technical and commercial feasibility study lasting 6-18 months.
Support for this phase is made available at 75% on the first £60,000 of eligible costs. The maximum award is £45,000. One third is paid up front to the winners and the remainder is normally paid quarterly against claims submitted.

If you win a SMART Award and successfully complete the first stage of your project you may then apply for further support to assist with the development of a pre-production prototype.

2. This second stage of the SMART scheme is separate from the first, is non-competitive, and grant is available at 35% of the eligible project costs, subject to a maximum grant of £150,000 for both stages of SMART. Second stage projects must take at least 6 months, and no more than 36 months, to complete.

SPUR

SPUR is an R&D support scheme whose aim is to help medium-sized businesses improve their competitiveness by developing new products and processes to the benefit of the national economy.

It does this by providing grants on a discretionary basis for development up to pre-production prototype stage of a new product or process which involves a significant technological advance.

In addition, a limited number of SPURPlus awards are available for small and medium-sized businesses attempting to develop world-beating products and processes for markets, such as telecommunications and biotechnology, which demand particularly expensive leading edge technology.

Highly innovative R&D projects which result in a pre-production prototype of a new product or process and which involve a significant technological advance for the industry or sector in the UK.

Projects must be of between 6 and 36 months duration, and involve eligible project costs of at least £50,000 for a SPUR grant and around £1 million for a SPURPlus award. Most technologies are eligible for support (but not defence projects).
SPUR and SPURPlus cannot be provided if there is no technical risk in the project, and you must be able to demonstrate that the grant is essential for your project to proceed.

Further information is available click here

RESEARCH AND DEVELOPMENT ASSISTANCE – TAX CREDITS

A recently introduced government programme gives businesses substantial tax relief for investing in research and development, which can help create:

•	new and more competitive products, services and processes;
•	new markets; and
•	high-quality job opportunities for skilled people.

This fact sheet tells you about the government’s tax credit programme and what it means for companies. To get more detailed information
click here

What kind companies can benefit from tax credits ?
Companies of all sizes can claim them. However there are two programmes - one for small and medium-sized companies (SMEs), and one for large companies.

1. The SME Programme
SMEs can find it difficult to carry out research and development (R&D), as it often needs long-term investment. They may be unable to commit this kind of money over long periods of time, or simply do not have access to the funding they need.
This programme encourages SMEs to carry out R&D for the first time, or to increase their level of R&D. A company is generally classed as an SME if it has:

•	fewer than 250 employees;
•	an annual turnover of up to Euro 40 million (about £25 million); and
•	an annual balance sheet total up to Euro 27 million (about £17 million).

In addition, a company cannot be an SME if more than 25% of its share capital is owned by a company that is not an SME.
There are some other conditions companies have to meet before they can be defined as SMEs. You can find more details on the Inland Revenue website.

How the programme works
The programme gives companies tax credits on the money they spend on R&D by:

•	increasing the tax relief they can claim from 100 per cent to 150 per cent on their qualifying R&D spending if they are in profit; or
•	giving them a cash payment of £24 for every £100 they spend on R&D if they are not in profit.
•	Companies can claim these tax credits on what’s called their qualifying R&D spending. The main conditions are:
•	They must spend at least £25,000 on R&D in the year they are claiming for. This money must be revenue spending, and cannot come from a third party or a “notified State Aid”, for example, a government grant. In a case like this, the company will still be able to claim150 per cent deduction (less the grant) on any revenue spending they meet themselves, but not the cash payment.
•	The money must pay for:
•	staff directly involved in carrying out the R&D;
•	the costs of materials and other equipment used in that R&D; or
•	certain costs if the work is sub-contracted.
•	A company can claim a tax credit for up to the amount of their total Class 1 PAYE and NIC payments of the accounting period.
•	Companies can claim tax credits on qualifying R&D expenditure made on or after 1 April 2000.
•	The R&D does not have to be carried out in the UK, but the company must keep the ownership rights of any intellectual property arising from the work.
•	A company cannot claim a tax credit on any R&D work that has been wholly or partly paid for with money from the public sector, for example by a government grant. However, in certain circumstances, they may still be able to claim some money and should contact the Inland Revenue for more details.

Tax credits are not available to individuals or partnerships.

2. The programme for larger companies

Large companies can claim an extra tax deductable allowance of 25 per cent on top of the existing 100 per cent first year allowances on qualifying R&D spending.
For example, if a company spends £100,000 on qualifying R&D, it can deduct £100,000 from its taxable income under ordinary tax rules and an additional £25,000 under the R&D tax credit.

And for a company paying the main rate of corporation tax at 30 per cent, the total credit would give a reduction in tax of £37,500. In addition, the Inland Revenue has introduced some special rules that mean large companies may not have to keep the intellectual property rights (IPR) from the R&D they claim for.

What does R&D cover ?
The government has published guidelines on what R&D means for tax purposes. These also cover R&D allowances (these capital allowances were previously called scientific research allowances).

To find more information on the Inland Revenue website or on the Department of Trade and Industry website click here

What about capital spending on R&D ?
Companies of all sizes can claim 100 per cent first year allowance tax relief on any capital they spend on R&D. This means they can claim two tax allowances:

•	the usual R&D capital allowance on their qualifying capital spending; and
•	the R&D tax credit on their qualifying revenue spending.

How can companies claim the R&D tax credit?
Companies can claim their R&D tax credit by completing their self-assessment return in the usual way. To receive the tax credit, they will need to claim amount that qualifies as R&D spending.

Where to find more information

•	To get more information about the R&D tax credit programme click here

UK STEEL ENTERPRISE

UK Steel Enterprise provides share capital and loan finance on attractive terms, in amounts from £15,000 to £150,000, for new or existing businesses which

•	Are based in one of our operating areas (large parts of North Ayrshire are eligible)
•	Can demonstrate long-term commercial viability
•	Have the potential for significant, sustained growth and
•	Are engaged in a manufacturing or related service.

For further details on UK Steel Enterprise support for business click here

WEST OF SCOTLAND LOAN FUND

The WoSLF is administered by North Ayrshire Council and can offer new or expanding companies loans, both secured and unsecured, up to £30,000. These loan usually form an integral part of a wider funding package to assist companies with the purchase of plant or machinery or with the provision of working capital. For further information on this loan please email Scott Webb or contact Scott on 01294 225171.

Details on any of the above schemes can be obtained from the Economic Development Services Team of North Ayrshire Council. Please email Scott Webb or Steve Cuthbert.