UK manufacturing sector reaps rewards of R&D tax breaks
The amount that firms claimed in tax reliefs rose 8% to £1.86bln in 2019/20, according to tax credit statistics released. The amount these companies are spending on R&D has also risen 8% to £14.1bln, while the number of claims made has risen at least 11.1%.
Mark Tighe, CEO of R&D tax relief specialist Catax, comments, 'The manufacturing sector is one of the largest claimants for this sort of tax benefit. It has shown its capacity to continue to innovate despite this latest year overlapping with a period of significant COVID disruption.
'Not only has R&D expenditure risen, but the number of companies claiming has also shot up, which is probably due to a combination of factors. Some firms will be engaging in this kind of work for the first time, possibly driven by environmental concerns as companies bid to become greener, while others will have only recently discovered they were eligible for these tax benefits, having perhaps missed out in previous years.'