Friday, 10 May 2019
New data shows R&D hotspots in the East Midlands
New data published by HMRC has revealed the hotspots for R&D tax relief claims across the East Midlands.
Leicestershire-based businesses topped the league for the number of claims for R&D tax credits in 2016-17 at 460 claims, followed by Northamptonshire on 430 and Derbyshire on 400.
In total, businesses across the East Midlands submitted 2,430 R&D claims in 2016-17, claiming some £145m in tax relief. Compared to the data reported for the previous year published in February 2018, this represents a 52 per cent rise in the number of claims and a 12 per cent rise in the amounts claimed in R&D tax credits.
The largest number of claims across the region came from manufacturing companies (865) who collectively claimed £55m, followed by professional, scientific and technical firms (435) who claimed £25m, followed by information and communication businesses (420) who claimed £20m.
R&D tax credits are a tax relief designed to encourage greater R&D spending, leading in turn to greater investment in innovation. They work by either reducing a company’s liability to corporation tax or providing a cash injection for companies without a tax liability (i.e. loss-making businesses).
Commenting on the new numbers, Sheetal Sanghvi, Central Region Head for R&D tax credits at RSM said: ‘Compared to the data released this time last year, the latest figures show a healthy rise in the numbers of applications for R&D tax credits, and higher payouts for East Midlands businesses involved in R&D activity.
‘While this is very encouraging, there are some sectors – construction in particular – where the numbers of claims are negligible, despite the likelihood that many are in fact involved in R&D activity.
'The fact is there could be many more businesses across the East Midlands that are undertaking R&D work but are missing out on R&D tax credit payments to which they are entitled.'Back