UK businesses’ R&D expenditure increased significantly in tax year 2021-22 according to the government’s latest provisional figures – and R&D tax relief rose by an even greater proportion.
Over 90,000 R&D tax credits claims were submitted during the 2021-22 tax year, an increase of 5% from the previous year and encompassing both the SME and RDEC schemes.
The total of 90,315 claims incorporated 8% higher expenditure on research and development projects which amounted to £44.1billion, 40% of which was spent by SMEs.
But while there was an 8% higher spend, 11% more was claimed back by companies as the level of tax relief rose to £7.6billion – 63% of which was via the SME scheme. The total support claimed through the SME scheme increased by 14% from the previous year.
Dividing the total amount of relief by the total number of claims resulted in an increase of 6% in the average value of a claim for 2021-22, with the proportion for SMEs specifically being 9%.
Industry sector analysis showed the largest number of claims, and the biggest amount of R&D tax relief, related to the Manufacturing, Information & Communication and Professional, Scientific & Technical sectors.
The figures were published by National Statistics in conjunction with HMRC and are provisional because backdated claims could still be made, although they have been grossed up to account for claims not yet received.