Finance Fred Heritage · 26 November 2015
Autumn Statement 2015: Advance Assurance will see small businesses receive R&D tax credits
Chancellor George Osborne announced new measures in the Autumn Statement that will enable small companies to seek “advance assurance” on tax relief for research and development (R&D) projects. The new measures assure small firms, those with anannual turnover of less than 2m and fewer than 50 employees, that the government will allow all tax relief claims related to R&D tax credits for three years. The tax relief is intended to reduce the amount of corporation tax payed by small companies by offsetting profits against any investments eachmake in important and often costly research and development. Latest government statistics indicate that more than 15, 000 SMEs claimed the tax relief in 2013: a 19 per cent increase on the previous year. Commenting on the statistics, published in the HMRC report “Making R&D Easier: A plan for small business R&D tax relief”, financial secretary to the treasury David Gauke said: We need to go further to support pioneering small businesses. research and development is crucial for the long-term growth of the UK economy. That’s why this government wants to increase awareness and make it easier to apply, he added. HMRC predicts that for each 1 of tax foregone by the research and development tax relief, between 1.53 and 2.35 of additional investment will be made by SMEs.
ABOUT THE EXPERTFred Heritage
Fred Heritage was previously deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London.