London sees another rise in R&D tax relief claims
The latest 2019-20 figures show London companies made a total of 17,210 claims, up from 14,685 made that this time last year.
13 October 2021
There were 15,005 successful R&D tax relief claims made by SMEs in the city region as well as additional claims secured through the RDEC scheme. Overall there were 85,900 R&D tax credit claims made across the UK in the 2019-20 period.
London companies also secured £592 million in rebates for Patent Box claims, another tax relief incentive available to help firms develop intellectual property (IP) assets. Overall, companies across the UK secured a total of £1,175 million in Patent Box tax breaks in 2019-20.
This year’s R&D tax credit statistics show manufacturing companies along with those in ‘Professional, Scientific and Technical’, and ‘Information and Communication’ sectors continuing to have the greatest volume of claims. The three categories account for a combined total of 64% of claims and 69% of the total amount claimed in 2019-20.
Commenting on the new figures, Scott Henderson, CEO of ABGI UK, said, “The popularity of the R&D tax credit schemes shows no signs of slowing down, although it’s important to note that these figures pre-date the pandemic. Manufacturing, information and communication, and professional, scientific and technical sectors once again dominate claims, accounting for 69% of the total amount claimed. All regions enjoyed increases in both number and value of claims.
“Provisional figures suggest that almost 1 in every 4 claims is being made by a business for the first time, which is great news. Patent Box claims numbers are disappointing however, with HMRC estimating only a 4% increase in the value of relief claimed. R&D is a critical component of innovation – and innovation is key not only to business recovery from COVID-19 but also to the health of our economy post-Brexit.
“The ongoing R&D tax reliefs consultation is addressing questions of targeting, efficacy and value for money for taxpayers. We are confident that the consultation will recognise the value of the schemes, take on board input from stakeholders like ourselves and propose changes which will improve access, address unprofessional agents and simplify the rules.”
Article originally published on London Loves Business
