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Beyond the Hype: What Official Data Say About R&D Tax Credit Claims in Future-Defining UK Sectors
For the first time, official government analysis has at least partially pulled back the curtain on the R&D Tax Credit claiming landscape for the UK's most future-defining sectors. If your company operates in Engineering Biology, Quantum Technology, or Robotics, the data is more than just interesting—it's essential: it reveals precisely how many companies are claiming R&D tax relief in each sector, the scale of R&D expenditure, and why the government officially acknowledges that many high-growth innovators must be expected to be operating at a loss.
The DSIT (Department for Science, Innovation and Technology) research and analysis report (Engineering Biology, Quantum Technology and Robotics and Autonomous Systems: Company Performance and R&D Tax Credit Estimates - Published 25 September 2025) matched its machine-learned company lists for three advanced-tech sectors (Engineering Biology, Quantum Technology, and Robotics & Autonomous Systems — “Eng Bio”, “Quantum”, “RAS”) to HMRC Corporation Tax and PAYE data to produce estimates of company performance and R&D tax credit usage. The report provides sector counts, turnover, employment, GVA and (from tax returns) R&D qualifying expenditure and numbers of claimants for accounting periods around 2021–22 and 2022–23. The analysis is highly relevant for UK R&D tax credit claimants as it provides official statistics on the extent of R&D investment and claiming behaviour within these high-growth sectors.
It demonstrates how HMRC is capable of benchmarking data within R&D tax Credit claims and make no mistake this capability can only increase with the use of AI.
As illustrated by the following table, the overall R&D landscape in these high-tech sectors shows a clear divide between activity and uptake of R&D tax relief, across the three sectors, which together represent nearly 3,800 active companies in the UK during the reference period.
Table 1: R&D Tax Credit Claiming Landscape by Sector
Interpretation Notes for the Claiming Landscape by Sector Table
Total SME Claimants: The column "Companies Claiming R&D Under the SME Scheme Only" refers to businesses that exclusively used the SME relief for all their claims. To get the total number of companies benefiting from the SME scheme's enhanced relief, you must also include those that claimed under both the SME and RDEC (Large Company) schemes (due to subcontracting rules or being an SME that received a subsidy).
Engineering Biology: 407 companies utilized the SME scheme (274 SME Only + 133 Both).
RAS: 473 companies utilized the SME scheme (377 SME Only + 96 Both).
Quantum Data Limitation: The data for the SME scheme in the Quantum Technology sector is suppressed (N/A) in the report to prevent the disclosure of individual company information, likely due to the very small population of large companies in that sector (only 10 active large companies in 2022-2023).
Summary of Key Findings on R&D Tax Credits
Of nearly 3,800 active UK companies in these sectors during the reference period, only 1,189 filed an R&D tax credit claim. While the Quantum Technology sector shows exceptional engagement, with 53 of its 78 active companies (68%) claiming, the other two fields stand out for the number not claiming: only 538 of 1,420 companies in Engineering Biology claimed, and just 598 out of 2,281 companies in Robotics and Autonomous Systems utilized R&D tax credits or relief. Does this indicate that thousands of potentially eligible innovators are yet to access this vital government funding or are they not really innovating? Summary data is set out in the following table.
Table 2: Estimated sector data for R&D claim percentages based on company accounting periods ending in 2021-2022
Highlights include:
Of nearly 3,800 active UK companies in these sectors during the reference period, only 1,189 filed an R&D tax credit claim. While the Quantum Technology sector shows exceptional engagement, with 53 of its 78 active companies (68%) claiming, the other two fields stand out for the number not claiming: only 538 of 1,420 companies in Engineering Biology claimed, and just 598 out of 2,281 companies in Robotics and Autonomous Systems utilized R&D tax credits High Claiming Activity: The Quantum Technology sector shows the highest propensity to claim, with over two-thirds (68%) of active companies utilizing R&D tax relief.Significant Expenditure: Engineering Biology stands out with the largest total estimated R&D qualifying expenditure for both SMEs (£980 million) and Large companies (£1,170 million), indicating a highly R&D-intensive sector.SME Scheme Uptake (ref table 1): For both Eng Bio and RAS, there were more SME claimants than large company claimants, though a significant portion also claimed under the Research and Development Expenditure Credit (RDEC/large scheme) or both schemes (the R&D claim rules at the time required SMEs undertaking funded or subsidised R&D to claim under RDEC).
Points of interest for UK R&D Tax Credit Claimants
The Expectation of Losses and Negative GVA in Tech: The report provides critical context for companies making claims, especially SMEs in high-tech fields. The analysis of company performance for the 2022-2023 financial year found that:
SME Losses are Common: SMEs in both Eng Bio and Quantum were estimated to have negative partially-gross trading profit (e.g., Eng Bio SMEs: -£3,340 million). This reinforces the understanding that high R&D activity often precedes profitability.
Negative GVA is a Feature, Not a Flaw: The report explicitly states that Gross Value Added (GVA) may not be an appropriate indicator of value for these sectors because: It is fully expected for smaller, early-stage companies with capital-intensive investment needs to show negative GVA (and profit). Current accounting standards fail to recognise investments in intangible assets (like R&D) as equivalent to investments in physical capital.
Takeaway for Claimants: For loss-making SMEs, this data supports the practice of claiming a payable cash credit, as HMRC/DSIT officially recognise that these early-stage tech companies are expected to be loss-making due to heavy R&D investment.
Benchmarking Claim Rates: The report's emphasis on the challenge of measuring R&D value through traditional metrics like GVA highlights the core nature of R&D work: the creation of intangible assets in the form of new knowledge and capabilities. Companies must ensure their R&D claim documentation clearly links their qualifying expenditure (staffing, software, consumables etc.) to the generation of new scientific or technological knowledge, capabilities and intellectual property.
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