HMRC has released data which shows a 49% uptick in SME claims for R&D tax credits between financial year 2008/9 and financial year 2011/12.
Over 10,000 SME companies in the UK claimed R&D tax credits in 2011/12 according to figures compiled by the Office for National Statistics.
In 2008/9 the figure was just over 6,000.
Since 2000, when the scheme was introduced but claimed by just 2,000 SMEs, over 24,000 companies of all sizes have claimed in excess of £6 billion back from HMRC in recognition of their efforts to innovate and improve products, processes and market applications.
Making a successful R&D tax claim often hangs on having well documented innovation and research processes.
If you’d like to bring more structure to your innovation and R&D or learn more about what an innovation strategy would look like in your company, attend TM’s Future Factory event, Inspiring Innovation in Manufacturing, London October 16.
EEF has welcomed the data. The manufacturing trade body’s economist at EEF, Felicity Burch said: “The SME R&D tax credit is an important scheme which can help companies with cash flow and encourage a virtuous circle of investment in R&D and innovation.”
She explained that this is important to help companies compete globally and in the long term rebalancing of the UK economy.
Ms Burch attributed the “encouraging” increase in the number of firms claiming R&D tax credits to recent improvements to the administration of the scheme by government and the relative stability in the tax regime over the past three years
Burch cautioned against complacency with the HMRC results however.
“The UK still has a long way to go, as levels of R&D expenditure lag well behind those of our competitors,” she commented.
Ms Burch’s comments reflect the findings in TM’s story last moth which revealed very low relative levels of investment from FTSE 100 manufacturers in R&D.
EEF has been tracking level of investment in innovation and R&D for its 2013 Innovation Monitor, produced in partnership with NatWest.
The report is due to be released on Monday (August 19).
