Member Article

North East businesses lose out as R&D tax relief claims surge

SMEs in the North East of England are losing out to other UK regions despite a remarkable surge of more than a quarter in claims for research and development (R&D) tax relief, according to R&D tax relief specialist Jumpstart.

Analysis by the Edinburgh-based company of the latest HMRC figures for 2012/13 - which record a 30% jump in the number of SME claims - shows that enterprises in London successfully claimed seventeen times the value won back by North East-based companies.

Businesses in London, which proportionally should have 13% of claims, netted 17% of successful applications and 31% of the financial benefits paid out by the scheme.

The welcome in business circles for the 30% increase in the number of SME claims was also tempered by the fact that the overall money given back by HMRC only rose by 13.1% and significant differences remain between different parts of the UK.

The South East had a disproportionate number of claims and the East of England - with just 7% of the population - claimed more than the North East of England, Scotland, Wales and Northern Ireland put together, which collectively have 20% of the population.

Simon Fisk, business analyst for Jumpstart in the North East of England, said: “There is no doubt that awareness of the government’s existing relief programme is increasing. The 30% increase in the number of SME claims has to be because of a better understanding of the scheme by companies and their advisors.

“However, companies in the North East are not reaping the full benefits which might be expected to accrue to them on a head of population basis. There is great scope in the region for a much more focused uptake of the scheme.

“Many companies in the North East have made significant gains following successful applications to HMRC by Jumpstart, but many more could achieve returns which can often be game-changing for smaller innovative concerns.”

This was posted in Bdaily's Members' News section by Ellen Forster .