Research and analysis
Evaluation of the research and development expenditure credit
This report evaluates the direct impacts of the research and development expenditure relief.
Documents
Details
This report studies the effectiveness of the research and development expenditure credit (RDEC), which is designed to incentivise greater business investment in research and development (R&D). Investment in R&D can increase productivity, so it is important for the long-term growth of economies.
This evaluation estimates that for every pound spent on R&D tax credits, between £2.4 and £2.7 is additionally invested in R&D by UK companies. The results are in line with the effectiveness of RDEC’s predecessor, the Large Company scheme, which was evaluated by HMRC in 2015 to stimulate around £2.35 for every pound of tax relief.
Updates to this page
Published 17 November 2020