Tax planning: Research & Development (R&D)

From 1 April 2012, the tax relief on allowable R&D expenditure was raised from 200% to 225%. The HMRC have reduced the conditions in order to make the relief more accessible to small to medium sized enterprises. There is no longer a minimum spend on qualifying R&D expenses which was previously capped at £10,000. Companies are advised to reassess their eligibility to claim the associated relief for R&D expenditure as they may find that they are able to claim relief for expenditure that did not meet the criteria previously.

Boris Johnson Elected as London Mayor

Boris Johnson was elected as the London mayor despite the poor performance of the Conservatives in the local elections. Boris has developed a good relationship with the electorate through his tough stance on crime and could well pose a future threat to David Cameron’s role as prime minister. 

Boris narrowly beat rival Ken Livingstone who may have suffered from discrepancies over his personal tax affairs, not to mention some of his outrageous statements made to the media. It is claimed that Ken sought to avoid tax by directing some of his income through his personal company. In a statement to the press, Ken stated that he will no longer run for London mayor in future elections.

Conservatives and LibDems suffer in Local Elections

Labour benefitted from the local elections by gaining a number of seats including Birmingham, Thurrock and Chorley. David Cameron and the Conservatives suffered losses on the back of voter angst over the government cuts and austerity measures. In a further blow, Nottingham ignored pleas from the Prime Minister and rejected proposals for an elected mayor. The Liberal Democrats fared the worst in the elections with their worst result since the party was formed. 

There was a disappointing turnout at the local elections with only 32% of people choosing to vote. This represents the lowest turnout at English local elections since the year 2000. The mayoral elections will be determined this evening.