The heartland of UK industry is the SME, and latest government data proves just how much technology development is still performed in the UK. The government’s R&D tax relief is aimed squarely at companies developing new technology, rewarding them with tax breaks for the technological risks they take, from developing new farm equipment to blue sky biotech.
R&D tax claims have risen almost a quarter in the last year from around 16,000 claimant companies to 20,000, with claim values totaling £350m. Since 2000, 120,000 claimants have claimed £11.4 billion in tax relief.
Small and medium sized businesses have been the star performers of the UK economy in recent months with the majority of these claims made by SMEs, which rose by 23% and large companies rising 4%.
The rise was seen across the country but with London, the east and southeast continuing to be the highest areas for claims at a total of 46%of all claims SMEs from the rest of the UK should really look into the R&D tax relief as many are missing out. A typical claim value is around 20p in every pound spent on development, usually repaid in cash by HMRC.
As the popularity of R&D tax claims rise, the chancellor took the politiucal opportunity last year to further boost innovation by announcing an increase in R&D tax credits to 230%. This means that for every £100 of qualifying costs, the corporation tax paid by SMEs on income could be reduced by an additional £130 on top of the £100 spent - which is great news for business.
0115 824 0402
SME –a Small to Medium sized Enterprise that is; less than 500 staff AND up to €100 m turnover OR up to €86 m balance sheet value