Monday, 1 October 2018
Claims for R&D tax credits increased 52%
Her Majesty's Revenue and Customs has reported a 52% rise in the number of claims for research and development tax credits submitted by East Midlands companies in 2016-17, with the level of support provided rising by 12%.
The latest data shows that companies in the East Midlands submitted 2,430 claims for research and development tax credits in 2016-17, up from 1,595 in 2015-16 reported in September last year.
The total amount of R&D support claimed rose to £145m, an increase of £15m from the previous year.
A total of £885m was claimed as qualifying R&D in 2016-17, a 17% decline from the previous year.
Introduced in 2000, R&D tax credits are designed as a tax relief to encourage greater R&D spending and innovation.
They work by reducing a company’s tax bill by an additional amount depending on the company’s allowable R&D expenditure.
Since launch, UK businesses have submitted over 240,000 claims, with £21.4bn claimed in tax relief.
Over time, the rate of relief has become more generous and is now worth up to 230% for SMEs. This means that for each £100 of qualifying costs, the corporation tax paid by SMEs on income could be reduced by up to an additional £24.70, East Midlands Business Link reported.