R&D Tax Credits – Here to Stay – Take Advantage of 46% Tax Relief

Over 1,000 Yorkshire and Humberside companies claimed Research and Development Tax Credits in the 2012/13 tax year, gaining an extra £45m in tax relief between them. That is higher than ever before, due in large part to the removal of the previous “minimum expenditure” requirement, and also the increasing value of the relief over recent years. For instance from April 2015 for every £100 spent on qualifying R&D, tax relief is given at 46%, not the normal 20%.The main areas of claim are on staff and consumables costs.

HMRC’s own report in March 2015 suggests that R&D tax relief is working to foster innovation by UK companies. This is counter to the Public Accounts Committee’s interpretation that suggests expenditure on R&D itself has been flat, despite the number of companies claiming the relief. There is no political agenda to remove R&D relief, but even if it is not incentivising your company to innovate any further than you already do, you should at least see if you are eligible to take advantage of the tax break like many other companies in our region. The statistic above should make you aware that R&D is not just the preserve of big PLCs. Each year around 30% of R&D claims are by new claimants, and around 10% by “sporadic” claimants.

Garbutt & Elliott assist a number of our clients – from manufacturing to software development – in identifying and preparing successful R&D claims with HMRC each year.

For further information please contact Rob Durrant-Walker on 01904 464100 or enquiry@garbutt-elliott.co.uk.