The 2022/23 tax year saw £7.5bn worth of research and development (R&D) tax credit claims, a rise of just £1bn despite a notable drop in businesses claiming the relief. R&D claims fell to 65,690, with SME claims down by 23% compared to the previous year.

Overall, £4.5bn was claimed in R&D credits, while £3.5bn came from R&D expenditure credit (RDEC) claims. Despite a 7% increase in claim expenditure, RDEC claims dropped by 9%. This decline is largely due to the decrease in smaller claims, under £15,000, while claims over £250,000 increased.

The IT, manufacturing and scientific sectors dominated the figures, making up 67% of R&D and 70% of RDEC claims. The largest band of claims ranged from £50,000 to £100,000, with over 11,000 claims in this bracket.

Regionally, London and the South East submitted the most claims, while Northern Ireland, Wales, Scotland and the North East had the fewest.

First-time applicants dropped by 19% from the previous year, and early data suggests this trend continued in 2022/23, although these figures remain provisional. HMRC has yet to release data on error and fraud for 2022/23 but has acknowledged the ongoing impact of legislative changes and operational measures.

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