While growth in R&D tax relief claims has increased by 35% annually since inception in 2001 to over £4bn last year the scheme is “yet to be fully utilised” by UK businesses, according to R&D specialists RIFT Research and Development.
RIFT’s research shows that £4.3bn was claimed across all R&D tax credit schemes to date – which the firm revealed is equivalent to paying the average £24,365 salary for nearly 178,000 employees.
London was found to be home to the largest number of claims with £1.2bn submitted and even with the higher annual salary of £31,567, the R&D work going on throughout the capital could employ 39,281 people for a year.
In addition, R&D claims in the south east and east of England have accumulated enough to pay the annual wage for 30,109 and 21,863 people respectively, while the West Midlands, North West and South West have also seen R&D claims total enough to pay the wage of over 10,000 people for a year.
Director of RIFT research and development, Sarah Collins, said: “R&D tax credits are a great way of paying back those companies that are committing to some outstanding work in their respective fields and regardless of how small the developments being made, they are all contributing to the future of their sectors and UK business as a whole.
“While many of us are very aware of this, we wanted to put into context just how much the claims being submitted equate to when you consider an everyday part of life like the average wage.”
She added: “However, there is still so much great work that isn’t being recognised in terms of its qualification for R&D tax credits and while it’s staggering to think R&D claims could fund 178,000 peoples wages for a year, we also wanted to highlight this huge Government cash pot to those that aren’t currently claiming but should be.”