R&D Tax Credit – Latest Statistics
HMRC have released statistics which reveal the number of R&D claims made in 2020, the amounts paid out in R&D support and which industries claimed the most R&D tax relief.
The government has said that it is eager for companies to prioritise and invest in innovation in order to boost the economy and make the UK a strong, global competitor.
Generous government R&D incentives, along with an increased visibility of R&D tax credit schemes, has led to an increase in the number of first-time SME claimants by 25%.
Here we highlight some key points to be taken from the statistics:
How many R&D tax credit claims were made?
There was a 16% increase in the total number of R&D tax credit claims made in the year ending March 2020, taking the total amount of claims made up to 85,900.
Small to medium-sized companies (SMEs) are still obviously making R&D projects a priority and are the driving force behind the increase in the number of R&D tax claims made. They accounted for 76,225 of all the R&D tax credit claims made.
How much R&D tax support did companies get?
The government paid out £7.4 billion in tax relief in the year to March 2020. This was up by 19% from the previous year.
In addition to SMEs making the most claims, they also received the most R&D tax support. They received £4.4 billion in R&D funding compared to larger companies, which received £3.1 billion.
Which sectors claimed the most R&D tax relief?
Making up 65% of all R&D claims made, the three biggest industries for R&D claims were:
- Information and Communication – 22% of all claims
- Manufacturing – 22% of all claims
- Professional, Scientific and Technical – 19% of all claims
Whilst 49% of all claims were made by companies based in London and the South East, the North West followed closely behind.
What do these statistics show?
Encouragingly, these statistics prove that R&D is still a priority for many large and SME companies in the UK, and as the need for innovation to boost the economy grows, the number of R&D tax claimants is expected to keep growing, year on year.
There are still many eligible companies failing to maximise their claims for R&D though and if you have invested in R&D we can help assess to see if you are entitled to tax relief.
Cowgills are experts in R&D tax claims, with over 13 years’ experience in reviewing, managing and submitting successful claims. Get in touch if you need our help.
The information was correct at time of publishing but may now be out of date.