The recently published 2022 Spring Statement1 indicates support for a “new culture of enterprise” and investment in ideas.
Notably, the UK government "recognises the growing volume of R&D being undertaken which is underpinned by pure mathematics" and have announced a significant tax reform in support of emerging, mathematically-driven sectors such as quantum computing, artificial intelligence and robotics. In particular, the Spring Statement declares that "the definition of R&D for tax reliefs will be expanded by clarifying that pure mathematics is a qualifying cost".
In addition, the government intends for the tax relief to cover "all cloud costs associated with R&D", which will facilitate data-heavy research by allowing companies "to claim for costs related to the storage of vital data".
The hope is that the combined effect of these reforms will drive further investment and innovation within the UK tech industry.
As acknowledged in the Spring Statement, while "these are important initial reforms", it seems the government is likely to explore further ways to improve the R&D tax relief system. We can expect to wait until the autumn for any further announcements.
References
1 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1062486/Spring_Statement_2022_Web_Accessible.pdf
This blog was written by Michali Demetroudi.
