Air filtration specialist traps £80k R&D tax relief

GT2 coalescer filters are used by the offshore and onshore gas sector in air intake systems. They are essential to prevent damage to turbines by removing particles and debris, but existing models were sent to landfill at the end of their lives.

Wolverhampton-based Airguard Filters committed hundreds of thousands of pounds in R&D spending to create a new design that could be easily separated into its constituent components, allowing them to be recycled.

Airguard ships its filters around the world, with many of them arriving in West Africa, where some of the world's largest power generation companies have a large offshore presence.

Its new modular design has other advantages. The company can ship components rather than the finished product, allowing Airguard to pack 10 times as many filters into a single shipping container. This reduces the product’s carbon footprint and means some components — including the metalwork and plastic profiles — can be re-used to make new filters, avoiding the need to recycle parts after every use.

The modular design also creates jobs in destination countries, where they are assembled on arrival.

Airguard Filters has a longstanding reputation for innovation and has netted £80,848 over the past four years for this and other innovations.

Since it was established in 1985, the business has worked with many multinational companies, such as GE, Siemens and West Midlands Metro, supplying filters for a variety of applications from North Sea oil & gas, railways as well as the manufacturing and engineering industries.

Other R&D projects undertaken by the company include adapting lamination machinery and enhancing Personal protective equipment theatre gowns to block pathogens more effectively.

Airguard is also in the process of perfecting a unique cardboard filter that is more effective at cleaning air pumped from extractors or destined for heating and ventilation systems.

R&D tax relief was introduced by the Government in 2000 to incentivise innovation, and results in either a reduction in a limited company’s corporation tax bill or a cash lump sum. Many firms don’t realise the work they do qualifies as R&D, which is defined as any work that seeks to resolve a scientific or technological uncertainty, whether that’s a new process, product or service. Crucially, R&D work does not need to have been successful to qualify, and claims can be made up to two years beyond the end of the tax year in which the work took place.

Maqbool Rafique, director of Airguard Filters, said: “Prior to this, we had no idea we qualified for R&D tax relief so it really opened our eyes to the innovation funding that’s out there. There will have been projects we’ve done in the past that probably would have qualified too. This tax relief is something that we are acutely aware of now whenever we look at developing a new product.

“We’re currently attempting to expand our international footprint because these sorts of filters are in demand all over the world, and we need to be able to compete with firms overseas on quality and price. We’ll have to continue to innovate if we’re going to succeed but knowing the tax relief is there to support us broadens our innovation horizons considerably.”

Kully Nijjar, associate director of innovation funding specialist Catax, added: “Airguard Filters is an example of a company that is always adapting. Maqbool and his team have done a superb job of identifying where further improvements could be made and the significant sums the company has received are testament to a huge amount of hard work. They are another example of a company that wasn't aware this relief applied to them but whose senior team now include the scheme as a key consideration in their future investment decisions.”