UK R&D tax-credit reforms ‘leave most small firms on cliff edge’

Businesses warn that most SMEs will be unable to access enhanced support

Reforms to R&D tax credits announced at yesterday’s UK government budget will be inaccessible to the majority of small businesses, which will face a “cliff edge in funding”, businesses have warned.

Delivering his spring budget on 15 March, chancellor Jeremy Hunt said he would introduce an “enhanced credit”, which means that if a loss-making small or medium-sized enterprise spends 40 per cent or more of its total expenditure on R&D, it will be able to claim a credit worth £27 for every £100 spent.