Renewable Energy R&D Tax Credits 18 September 2014 Brian Thornton Partner KPMG

1 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. Agenda 1.What is the R&D tax credit? 2.Key technical requirements 3.Eligible expenditure & finance

What is the R&D Tax Credit?

3 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. What is the R&D tax credit? €25 credit / cash for every incremental €100 spent

4 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. What is the R&D tax credit? The credit incentivises companies to invest in Ireland and increase R&D spend in the Irish economy. The credit encourages companies to create new jobs in Ireland. The credit rewards companies being innovative. The R&D tax credit is key in Ireland’s economic growth policy.

Key technical requirements

6 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. Qualifying Activities Seek to achieve scientific or technological advancement Involve the resolution of scientific or technological uncertainty Systematic, investigative or experimental activities Revenue approved field of science or technology I. Basic research II. Applied research III. Experimental development 5 Key Requirements

Eligible expenditure and finance

8 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. VHI Eligible expenditure Pension Share options Eligible Expenditure Salary Plant and Machinery Subcontracted R&D Light, heat, power, and...? R&D Buildings

9 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. Eligible expenditure Other eligible expenditure?  Outsourced expenditure to third parties and universities to carry on R&D

10 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. The R&D tax credit must be claimed within 12 months of the financial year end! Claiming the R&D tax credit

11 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. Claim calculation Company X Year ended 31/12/2013 Salaries €500,000 Plant & Machinery €500,000 Overheads €200,000 Eligible Spend = €1,200,000 Less Grant (€200,000) Less Base Year (2003) (€0) Incremental Spend = €1,000,000 25% Tax Credit = €250,000 Sample calculation:

12 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland. Take Home Points: 1.Worthwhile credit - €25 rebate for every €100 spent 2.Must be claimed within 1 year 3.Significant documentation requirements – the price to be paid! 4.Important to seek advice early

13 © 2014 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in Ireland.

Thank You Brian Thornton