Manchester, 29 September 2023 – East of England businesses made 7% more claims for research and development (R&D) tax relief, a steeper increase than anywhere outside London, according to analysis of new Government statistics by Ryan, a leading global tax services and software provider.
The data, released last week, is captured by HMRC and is based on claims made for R&D tax relief, which reward businesses for qualifying innovation.
The number of tax relief claims for R&D projects made by East of England businesses rose from 8,185 to 8,770 claims.
At the same time, expenditure on high-reward R&D grew marginally in the region by 1.1% from £5.04 billion in 2020/21 to £5.1 billion in 2021/22. In total, East of England businesses claimed £815 million in R&D tax relief, with an average claim value of £92,930.
Total claims and spending by region in 2020/21 v 2021/22
|Region||Total claims 2020/21||Total Expenditure 2020/21 (£ millions)||Total claims 2021/22||Total expenditure 2021/22 (£ millions)||Change in claims||Change in expenditure|
|East of England||8,185||5,040||8,770||5,095||7.2%||1.1%|
|Yorkshire and The Humber||6,395||1,560||6,805||1,930||6.4%||23.7%|
Overall, UK-wide innovation spending that qualifies for tax relief rose 8% to £44.1bn in 2021/22. However, the number of first-time claimants has fallen for the second year running.
R&D projects carried out by UK companies introduce new products and services to the marketplace, which play a critical role in economic growth as they attract investment, boost exports and lead to the creation of more skilled jobs.
R&D tax relief was introduced in 2000 to encourage and reward innovation and results in either a reduction in a limited company’s corporation tax bill or a cash lump sum for companies seeking to resolve a scientific or technological uncertainty.
“The growth in the number of businesses in the East of England making claims for R&D tax relief bodes well for the future.”
“Innovation spending plays a big role in driving economic growth and employment, and so it is important that business leaders do what they can to encourage research and development in their region.”