This week, HMRC released its R&D statistics report, and while the numbers are positive, we still have a ways to go, especially given the massive shift that 2020 has gone through. The report shows continued percentage increases on the number of claims and refund amount. However, the Government’s goal is £22 billion of R&D funding per year by 2024-2025, and the increases are not enough to put us on track. Add to that the economic downturn that the pandemic has brought, and we’re going to need a big push to reach those goals. R&D will be key in the U.K.’s recovery, and the Government needs to ensure that the claim process is as accessible as possible.
The most noteworthy statistics:
- 59,265 business were funded R&D credits in the 2018-19 tax year,
- 52,160 in the Small or Medium-sized Enterprise (SME) scheme
- 7,105 in the Research and Development Expenditure Credit (RDEC) scheme
- £5.3 billion has been provided to those businesses
- £3 billion through the SME scheme
- £2.4 billion through the RDEC scheme (£265 million of this claimed by small and medium sized companies)
- The average RDEC claim value was £337,790, while the average SME claim value was £57,515
- SME claims rose by 19%
- First time applicant claims increased by 10%
- 45% of claims came from London, South East and East of England (based on regional head office locations)
- 66% of claims were from ‘Manufacturing’, ‘Professional, Scientific and Technical’, and ‘Information and Communication’ sectors (24%, 23% and 20% respectively)
*all statistics are as of June 30, 2020
Read the whole report here.
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Who we are:
Swanson Reed is one of the U.K.’s largest Specialist R&D tax advisory firms, offering tax credibility assessments, claim preparation, and advisory services. We manage all facets of the R&D tax credit program, from claim preparation & audit compliance to claim disputes.
For more information please visit us at www.swansonreed.co.uk or contact your usual Swanson Reed representative.