The cost of research and development (R&D) tax relief claims across the UK has risen by £380 million, with much of the rise coming from the small business sector.
New figures from HM Revenue & Customs, suggests an increasing awareness of the benefits of R&D tax relief has driven the dramatic rise in the number of claims.
ForrestBrown, R&D Tax Credit Consultants, said the new data showed that the amount claimed under UK government schemes soared by £380 million in 2013-14 to £1.75 billion – a 27 per cent year-on-year increase.
This would appear to be underpinned by small firms with SME R&D tax relief claims up by 23 per cent, while large company claims only rose by four per cent.
The data also suggests that the tech sector is booming, and manufacturing companies are really starting to take advantage of the R&D tax relief they are entitled to, with a nearly 30% increase in total amount claimed year-on-year.
Lisa-Marie Smith, Director, ForrestBrown commented: “The headline statistics make for great reading, with SME claims up 23% and the overall value of support claimed under all schemes increasing by £380 million.
"One of the most interesting aspects is what it tells us about underlying research and development activity in the UK, with the total level of qualifying expenditure at £14.3 billion, an increase of 7% over last year. I would expect next years statistics to continue to demonstrate the increases we’re seeing, and maybe even escalate as the impact of the increase in the value of the payable tax credit takes effect.
"We think that a lot of companies who are claiming R&D tax credits may still have barely scratched the surface in terms of how much R&D tax relief they may be entitled to, but seeing the increased awareness is really heartening, and we have great hopes for UK research and technology over the coming year!" added Smith.
TaxAssist Accountants have a national relationship with ForrestBrown. If you think you might qualify for research and development tax relief, your local TaxAssist Accountant and ForrestBrown can work together to investigate the viability of submitting a claim on your behalf. Contact us for more information.