North East businesses missing out on vital R & D tax relief
Businesses in the North East are potentially missing out on millions of pounds of tax relief, according to Nicola Bellerby, tax partner at Clive Owen LLP. Latest figures from HM Revenue & Customs (2018/19) show that the North East has the lowest number of claims for R & D tax relief than any other region in England. Research and Development (R&D) relief supports companies that work on innovative projects in science and technology. It can be claimed by a range of companies that seek to research or develop an advance in their field. It can even be claimed on unsuccessful projects. HMRC recently published figures on R&D tax credit claims which show that total number of claims for R&D tax credits rose to 62,095, which is an increase of 17% from 2016-17. The increase was primarily driven by a rise in the number of SME claims.
Only around 2,000 North East companies made R & D claims compared to: • London – 12,000 • South East – 9,000 • North West – 6,000 • West Midlands – 5,000 • East Midlands – 4,000 • Yorkshire/The Humber – 4,000 • East Midlands – 4,000
The majority of the overall claims come from manufacturing companies, followed closely by information/communication companies and those companies within professional/scientific/technical sector
Nicola Bellerby said: “Despite the growth in the number of claims, there is a significant disparity across the regions in the number of companies applying. With the Government coronavirus support now drying up for many sectors, it is an opportunity for North East based companies to consider this well-established and robust scheme to bolster cash flow.
“We believe that a lack of proactive advice to companies and, more often than not, the modesty of business owners are the main reasons for the low uptake of R & D tax relief in this region. “It is frustrating that when we meet potential clients and talk about their business and discuss the challenges they are facing delivering a project, R & D tax relief is dismissed as not being relevant. “R & D is a genuine entitlement and at a time when many companies are struggling financially with COVID and Brexit causing such uncertainty it makes sense to explore all avenues of financial support.”
This was posted in Bdaily's Members' News section by News Gathering .