Date24 Mar 2022
CategoryR&D Tax Incentives, Tax, Corporate Tax
Rishi Sunak, acknowledged that innovation in the UK is lagging behind. What are his plans to overcome this?
In yesterday's Spring Statement the Chancellor, Rishi Sunak, acknowledged that innovation in the UK is lagging behind other advanced economies, with investment by businesses in Research & Development (as a % of GDP) less than half the OECD average. This is against a backdrop of a greater spend on Tax Reliefs for R&D in the UK than in almost every other country.
To address this anomaly the Chancellor re-affirmed a commitment to ongoing reform of R&D Tax Credits, to make them more effective and better value for money for the UK taxpayer.
The headline announcements were:
Tim Croft, National Head of R&D at Azets, commented “The overall picture seems to be a positive one for companies eligible for R&D Tax Relief.
It is great to see pure maths brought into the definition of R&D Qualifying Activity, recognising the huge contribution to innovation by businesses working in areas such as Robotics and AI.
We also welcome the re-think on overseas qualifying costs, with a recognition that some UK companies have little choice but to undertake their R&D activities offshore for legal, regulatory and geographical reasons.
Any future increases in the generosity in the RDEC provisions will be very welcome to the many SME’s we see who are making claims under this regime, and we wait to hear how this proposal will develop in Autumn’s budget.
Finally, we warmly welcome the commitment to tackling of abuses, as we continue to witness certain players in the market approaching our clients with erroneous and dishonest interpretations of R&D Tax Relief. It is vital for the integrity of the Scheme that these abuses are challenged and rooted out.”
At Azets, our trusted business advisors are on hand to offer R&D tax relief advice and have a wealth of experience in making R&D claims in a wide range of industries and sectors. Our specialists have an excellent track record in making successful, HMRC-compliant claims and have delivered significant tax savings for our clients.
Using our deep knowledge of the government support available, the qualifying criteria, and the application process, we’ll help you to unlock those all-important incentives and cash injections.
Get in touch with the Azets specialist R&D team today to find out more and get started with your claim.