Ten New Faces at RMT Accountants as Practice Expansion Drive Accelerates
June 1, 2018
There were 13,010 claims for research and development tax relief under the SME scheme in 2012/13 – up 30% from the previous year and the largest number since the scheme was introduced in 2000 – according to official HMRC figures.
The amount claimed by small businesses reached almost £600m, up from £430m last year. Overall, the total number of claims, combining the SME and large companies schemes, rose 26% to 15,930.
The HMRC figures also show that R&D tax relief is not just the preserve of manufacturing companies. Although the manufacturing sector still has the most applications with 3,970 applications for relief of £165m, information and communications companies put in 3,585 claims, and professional, scientific and technical businesses accounted for 2,410 applications, for a total of £145m in relief. Only three sectors among 20 failed to apply for R&D credits during the period: public administration, defence and public services; households; and overseas firms.
Firms in the south east recorded the highest number of claims in England under the SME R&D scheme with 2,435 claims worth £120m in relief. The region with the lowest number of claims was the north east, with only 470 claims worth £20m.
Tax credits on R&D were introduced in 2000 in an attempt by the government to encourage research and innovation. Since then the available tax breaks have become increasingly generous and HMRC has also broadened its interpretation of the rules to apply more widely and provide a greater stimulus. The level of corporation tax relief for SMEs has been more than doubled to 225% of the R&D expenditure over the last two years and the £10,000 a year minimum spending limit has been scrapped.
With more and more SMEs realising that R&D tax credits aren’t just for large manufacturing firms or tech companies, but for many other types of business working on innovative products or processes, could your firm benefit? We can advise on whether the relevant conditions can be met.
If you wish to fine out more please contact us.
June 1, 2018