London dominates in R&D tax credits claim value

HMRC figures show London-based companies once again securing a major share of R&D (research and development) tax relief with over £2.3bn paid out in 2019-20. Other strong performing areas include the West Midlands, Cambridgeshire, Oxfordshire, and Surrey where businesses collectively secured almost £1.3bn in tax relief for innovation-focused investment.

Other regions securing significant R&D rebates include Greater Manchester, Hertfordshire and Hampshire. 

Businesses in Mid Ulster, however, have claimed the top spot in R&D tax claims intensity in the UK according to this year’s UK Innovation Intensity League Table, published by innovation funding specialists ABGI-UK. It shows the leading 20 unitary authority areas which are ranked on the percentage of local businesses making a successful claim for R&D tax relief.

Mid Ulster (which was 3rd two years ago) tops the table with a total of 400 successful claims made by local SMEs and large businesses, representing 6.1% of all enterprises within its unitary authority area. Cambridgeshire placed second in this year’s table (up from 4th) with five percent of its businesses securing a successful claim. Nottingham placed 3rd in the table (up from 7th two years ago) with 4.8%.

Commenting on the rankings, Scott Henderson, Chief Executive at ABGI-UK said: “As our Innovation League Table shows, there many parts of the UK where companies are heavily investing in research and development activities. As our top three areas of Mid Ulster, Cambridgeshire and Nottingham demonstrate, there is a lot of innovation going on outside the M25 corridor. 

“Companies within key sectors including manufacturing, engineering and IT/software are mainly behind this strong regional placement in our league table. By securing R&D tax relief for their innovation investment, a significant proportion of companies are benefitting by enhancing competitiveness. More of this investment activity will be critical in kick-starting the UK economy as we emerge from the recent public health crisis.”

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ABGI UK is a tax incentive and innovation management advisors. ABGI is the consulting arm of the French-listed technology business Visiativ.

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