Autumn statement: ForrestBrown welcomes R&D tax credit boost for both SMEs and Large Companies
“The increase to the research and development (R&D) tax credit schemes announced by the Chancellor today is a clear recognition of the impact they have had so far in encouraging businesses to invest in innovation and helping to increase the UK’s global competitiveness", said Simon Brown, Managing Director of Bristol-based R&D tax credit consultancy ForrestBrown.
“With the rate of the SME tax credit scheme increasing from 225% to 230%, from 1 April 2015, SMEs in the region will now be able to recover up to a third of their R&D expenditure. The ‘above the line’ credit for large companies has also been increased from 10% to 11%, which makes it even more attractive for the region’s bigger firms.
“For companies in the South West, the impact of today’s announcement could be significant. The region has a wealth of innovative businesses that could now be eligible to claim increased R&D tax credits. ForrestBrown has worked with a number of these businesses, both SMEs and large companies, and many of them part of the region’s renowned digital hub, but the number of those taking advantage of the R&D tax credit schemes is still very low.
“South West-based companies made only 1,265 R&D tax credit claims in 2012-13, accounting for less than 8% of the total claims made across the UK. Although this figure represents a 19% increase in the number of South West claims compared to 2011-12, the average increase across the UK was 26% which suggests that businesses in the region are still missing out.
“The Chancellor’s statement today is not only very positive news for those business wishing to claim against the current and future years, but it will also raise awareness of the R&D tax credit schemes to those businesses that have not claimed in the past and should now urgently look at reviewing their previous two accounting periods.
“We’ve seen first-hand the benefit the schemes have had on innovative businesses in the region, and we hope the latest raft of updates encourages more of them to come forward to ensure they don’t miss out.”