The UK government has published the latest annual statistics for R&D tax relief in its ‘2025 Research and Development tax credits’ publication, providing valuable insights into how businesses have been engaging with the scheme following recent reforms.
At a glance
- R&D tax relief claims fell by 26% in 2023/24, with £7.6 billion claimed
- Average claim value rose by 33% as small claims dropped and large claims increased
- Top R&D claiming sectors were Information and Communication, Manufacturing and Professional Scientific and Technical
On the 30th September, HMRC released its annual statistics relating to R&D relief. The statistics provide insight into regional concentrations of claimants as well as sector designations.
The publication marks the first opportunity to assess the effects of relief rate changes for both the RDEC and SME schemes. However, data related to the newly introduced ‘merged scheme’ as well as ERIS (R&D intensive loss making SMEs) will appear in next year’s statistics.
Broader context
The statistics are released on a backdrop of tremendous change for R&D relief:
- SME additional deduction reduced from 130% to 86%
- RDEC rate increased from 13% to 20%
- Requirement to pre notify of an intention to make an R&D for lapsed / new claimants.
- Clarity of ‘subsidised / subcontracted’ expenditure
Key statistics
The provisional estimated total amount of R&D tax relief support that was claimed for the tax year 2023/24 was £7.6 billion, which is a 2% decrease from the previous year.
The total number of R&D claims for the tax year 2023/24 is estimated to be 46,950, which is a decrease of 26% from the previous year. This amount comprises of 36,885 SME scheme claims and 10,065 RDEC scheme claims.
The volume of SME scheme claims was in total 31% lower than the previous year and claims for the RDEC scheme fell by 5%.
There has been a significant drop in the number of claims for up to £15,000 of tax relief compared to larger claims that are over £250,000. This has resulted in a 33% increase in average claim value compared to the previous year, reflecting the increased benefit of the RDEC scheme, which serves large companies.
Sectors
In this year’s statistics, the Information and Communication, Manufacturing and Professional Scientific and Technical sectors continued to have the greatest volume of claims. These sectors made up 72% of total claims and 71% of the total amount claimed for the tax year 2023/24.
Four sectors have seen a decrease in over 70% since the 2021/22 tax year: Accommodation and Food, Wholesale and Retail Trade, Real Estate and Education.
Felix Key, R&D Director, comments: “The stats are incredibly illuminating and it’s clear the changes to R&D relief have taken hold and show a sharp contrast with prior years. I can say that I have not seen a noticeable drop in appetite to seek R&D relief in the SME market, which leads me to believe that legitimate claimants remain engaged with reputable advisors.”
The full publication of HMRC’s R&D statistics and analysis can be read here.
Our team of R&D experts can support you and help guide you through the process of making a claim. Get in touch with us today to see what we can do for you and your business.
