R&D Tax Relief – Update

HM Revenue & customs (HMRC) has recently published its annual statistics for company claims for Research & Development (R&D) tax relief claims.

There continues to be an increased uptake in claiming the generous relief, partly as the relief becomes even more generous and partly as more and more companies become aware of the relief for the first time.

The data is for the 2012/13 financial year. The headline statistics are: ◾Since its introduction in 2000 over 100,000 claims have been made by over 35,500 different companies claiming in excess of £9.5 billion in tax relief ◾15,930 claims were made in 2012-13, an increase of 26% over the previous year; qualifying costs within the claims totalled £13.2 billion, 10% higher than the previous year ◾“Manufacturing”, “Professional, Scientific and Technical” and “Information and Communication” sectors accounted for 77.1% of the claims and 80% of the total amount claimed (sector data based on SIC2007 coding for claimant company) ◾8,740 claims by Small and Medium Sized Enterprises (SMEs) (being a very generous definition of such for this purpose) reduced their tax bills whereas a further 1,220 SMEs claimed payable credit (cash back) as they were loss making. 3,050 SMEs made a claim for a combination of tax deduction and cash back ◾Although SMEs make up the greater number of claims, 80% of expenditure claimed was made by large companies (£10.6 billion compared to £2.6 billion for SMEs) ◾580 SME companies claimed under the large scheme as sub-contractors to large company R&D ◾545 claims were made in the North East of England, 1,545 in the North West of England, 1,065 in Yorkshire and Humber and 905 in Scotland, claiming £25m, £85m, £45m and £45m respectively. Over 40% of claims are made by companies in London and the South East. (region data based on registered office)

What’s stopping you making a claim?

There are still many companies failing to make claims for various reasons. Our experience shows that generally business owners, like yourself, usually think that some or all of the following apply: ◾We are not doing R&D – many companies do not initially realise that their project qualifies as R&D ◾Claiming the relief is complicated – not if you seek good advice ◾The costs of claiming outweigh the benefits – this is rarely the case and our charges are structured based on the tax savings generated ◾We cannot separately identify costs – HMRC does not expect you to reinvent your accounting records to make a claim and will accept some elements of estimation ◾We’ve received a grant towards R&D or capital expenditure, therefore we can’ have the tax relief too – this is by far the biggest misconception. The receipt of a grant may affect how much additional tax relief the company can claim but you can have both!

What tax relief is available?

The three tax reliefs for innovative companies are very generous and are: 1.R&D tax relief as above. 125% additional relief on costs for SMEs, 30% for large companies or SMEs with grant funding or subcontractors to large companies. New Research & Development Expenditure Credit (RDEC) for large companies to allow for payable credit as an alternative to the 30% relief 2.Patent Box – an effective 10% rate of Corporation Tax on relevant profits from patents 3.100% capital allowances for assets acquired, including buildings, used in R&D

How Pierce can help you

We have many years’ experience preparing R&D claims for a range of businesses. We have a 100% record with HMRC – none of our claims have been reduced or rejected by HMRC. In the previous 12 months we have secured R&D tax refunds in excess of £500,000 for our clients. We can also help you claim R&D tax refunds for previous tax years if you haven’t previously made a claim. We offer a free no obligation review of your business activities to identify any R&D tax planning opportunities for you. Contact either Ben Smith or Tom Wilkinson by phone on 01254 688100 to find out more.

Enjoyed this? Read more from Pierce CA Ltd

Latest news

1

Lancashire emerges as key player in UK's Defence and Tech Sector Mo Isap Chair Of The Lancashire Business Board Nick Miles National Cyber Force Deputy Director For Samlesbury Annette Weekes Representative Of The NWRDSC

Lancashire emerges as key player in UK's Defence and Tech Sector

03 Jul 2025

2

Report shows impact of BAE Systems in Lancashire BAE Systems Radar

Report shows impact of BAE Systems in Lancashire

02 Jul 2025

3

Three weekly domestic waste collection considered in plans Waste recycling Blackpool

Three weekly domestic waste collection considered in plans

01 Jul 2025

4

Graham Engineering confirms sale to a2e Industries Graham Engineering

Graham Engineering confirms sale to a2e Industries

01 Jul 2025

5

Training 2000 celebrates 'Good' rating by Ofsted Training 2000

Training 2000 celebrates 'Good' rating by Ofsted

01 Jul 2025

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
LBV123 July/August Launch Event
Lancashire Business View magazine launch
Networking
16 Jul 2025

LBV123 July/August Launch Event

Burnley

08:30 - 10:30

Lancashire Built Environment Conference 2025
BEC 315 X 315 Px
Networking
25 Sep 2025

Lancashire Built Environment Conference 2025

Blackpool Football Club, Blackpool, FY1 6HX

08:30 - 13:00

CMI Level 5 Management and Leadership Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Management and Leadership Course

Preston Campus, Preston , PR1 2HE

09:00 - 17:00

CMI Level 5 Project Management Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Project Management Course

Preston Campus, Preston, PR1 2HE

08:00 - 17:00

The Marketing Metrics that Matter – July 4
LBV Hub Seminars
04 Jul 2025 - 04 Jul 2025

The Marketing Metrics that Matter – July 4

Door4 Office, Burnley Wharf, Burnley, BB11 1JG

08:30 - 11:00

Tri-Site Survey Equipment Showcase
unnamed (2).jpg.jpg
LBV Hub Seminars
09 Jul 2025 - 09 Jul 2025

Tri-Site Survey Equipment Showcase

Crow Wood Hotel, Burnley, BB12 0RT

09:30 - 16:00

Blackburn Cathedral hosts Champagne and Diamonds Event with Ainsworth Jewellers
Champagne-Jewellery 10 07 25_page-0001.jpg.jpg
LBV Hub Awards
10 Jul 2025 - 10 Jul 2025

Blackburn Cathedral hosts Champagne and Diamonds Event with Ainsworth Jewellers

Blackburn Cathedral, Blackburn, BB1 5AA

18:00 - 20:30

Choose Chorley for Business - Talent Reimagined Business Breakfast
talentreimaginedbb.png.png
LBV Hub Seminars
10 Jul 2025 - 10 Jul 2025

Choose Chorley for Business - Talent Reimagined Business Breakfast

Strawberry Fields Digital Hub, Chorley, PR71PS

08:00 - 10:30

Shaping Preston's future by remembering its past
1750160034867.png.png
LBV Hub Networking
16 Jul 2025 - 16 Jul 2025

Shaping Preston's future by remembering its past

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 20:30

Chamber Summer BBQ
LBV Hub Social
17 Jul 2025 - 17 Jul 2025

Chamber Summer BBQ

The Borough, Dalton Square, Lancaster, LA1 1PP

17:30 - 20:00

Preston Tech Connection: Web3 is Dead. Or is It?
July Longer Banner.jpg.jpg
LBV Hub Networking
29 Jul 2025 - 29 Jul 2025

Preston Tech Connection: Web3 is Dead. Or is It?

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:30

Preston Freelancer Meet-Up: July
Longer July Banner.jpg.jpg
LBV Hub Networking
31 Jul 2025 - 31 Jul 2025

Preston Freelancer Meet-Up: July

Society1, Coworking Space, Preston, PR1 3LT

10:00 - 11:30

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV122 Online Graphic
Subscribe now

Weekly news bulletin