THE NUMBER of claims for tax credits on research and development costs have risen 30%, according to official figures.
In total, there were 13,010 claims for R&D tax relief under the SME scheme in 2012/13 - the highest ever since the scheme was introduced in 2000 - with the amount claimed reaching almost £600m, up from £430m last year.
Overall, the total number of claims (combining the SME and large companies R&D schemes) rose to 15,930, an increase of 26% compared to 2011/12.
R&D tax credits, which were first introduced in 2000, are a tax relief designed to encourage greater R&D spending and innovation. Since the introduction of the scheme, the available tax breaks have become more generous and HMRC has broadened the way it interprets and applies the rules in order to provide greater stimulus for innovation in the economy.
Baker Tilly R&D tax director Andy Nash said: "There has been a huge rise in the numbers of SMEs claiming this type of tax relief, due in large part to the increase in the enhanced expenditure for SMEs which came into force from 1 April 2012, but this doesn't tell the whole story.
"Perceptions are changing, and many SMEs are realising that R&D tax relief isn't just for the manufacturing or tech sectors and can apply to many other sectors that are developing innovative products or processes."
Businesses in the south east recorded the highest number of claims in England under the SME R&D scheme with 2,435 claims worth £120m in relief, the north east recorded the lowest number with only 470 claims worth £20m.
You may also like
AccountancyAgeInsight is a frequently updated resource centre for finance professionals, offering a free and easy-to-use digital library of briefings, white papers and other information resources.