R&D Tax Credits – are you making the most of them?
Earlier this month HMRC released their updated R&D statistics for 2017/18, and whilst the figures are incomplete, due to a large number of outstanding submissions, there are some interesting findings.
It is clear from the statistics that the number of claims is still increasing at a rapid rate and the figures have risen exponentially since the tax relief was introduced. Since the R&D tax credit scheme was launched £26.9 billion of tax relief have been claimed.
Even though the number of claims is increasing the government still believes that R&D relief isn’t being claimed enough. This can be illustrated by the analysis of which sectors are claiming for R&D, as out of the 19 sectors that statistics were provided nearly 70% were from 3 of the sectors: Manufacturing, Information and Communication and Professional, Scientific and Technical.
Due to the other 16 sectors making up only 30% of the claims, it may mean that there is a lack of awareness of R&D and how it may be applicable to these sectors. Companies in non-traditional sectors such as construction and food and drink should consider whether any of their innovation is eligible for the relief.
Moving closer to home the statistics for Yorkshire and the Humber indicate there is a huge opportunity for more (and larger) R&D claims. Even though the number of claims has increased by 28% since the last period, the region is still only the 7th highest in number of claims being made which is the same as previous period. Knowing what a hugely innovative region this is it is surprising we aren’t higher up the leaderboard. From working on numerous R&D claims in this region I know there is a wide range of sectors where the relief can be claimed, but it is our job to ensure that more businesses are aware of the potential reliefs to be claimed.
For more information on how we can assess whether you could make an R&D claim and for assistance in the process, please contact: Steven Holmes email@example.com or John Low firstname.lastname@example.org or call 0113 273 9600. We are here to help.