North West companies ‘missing out’ on millions of pounds in tax credits

R&D tax relief specialist Jumpstart says despite an increase of 19% year-on-year North West companies accounted for just 10% of total claims and a mere 6% of the total tax benefits claimed. Neil Hodgson reports

Russell McGrath, business development manager for Jumpstart in the North West

 

Firms in Merseyside and across the North West are still losing out on millions of pounds of research and development tax savings compared to the rest of the UK.

That’s according to R&D tax relief specialist Jumpstart which has analysed the total R&D tax credits claimed in 2015-2016

It says despite an increase of 19% year-on-year North West companies accounted for just 10% of total claims and a mere 6% of the total tax benefits claimed.

Of the 2,665 North West claims, 2,290 were claimed under the SME R&D scheme and the remainder were claimed under schemes for large companies.

Russell McGrath, business development manager for Jumpstart in the North West, said: “These latest HMRC figures are an alarming demonstration of just how much North West companies are losing out in terms of tax savings compared to companies across the rest of the UK.

“Of the 26,255 claims across the UK totalling £2.9bn in tax benefits, only 2,665 claims came from companies in the North West and resulted in just £160m back.”

London and the South East made the highest number of claims in the year. London companies accounted for 19% of all claims and 29% of the total tax relief claimed, and the South East accounted for 17% of claims and 20% of the total claimed.

The figures show a concentration of claims in manufacturing (28% of claims and 32% of total claimed); professional, scientific & technical (20% of claims and 23% of total claimed); and information & communication (26% of claims and 20% of total claimed).

Mr McGrath added: “Whilst uptake of the UK government’s R&D tax relief scheme is increasing across the UK as a whole and is very healthy in certain regions, I don’t feel companies in the North West are reaping the full benefits of the scheme.”

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