Over three quarters of UK businesses have said they expect to see an increase in turnover and improved productivity in 2018.
Nearly 65% of businesses expect to see overall growth in the coming year, despite the increase in inflation and confusion that Brexit has caused.
These findings come from R&D tax credit specialists, the MPA group, who surveyed a selection of UK manufacturing, engineering, IT, and life sciences businesses.
“While it’s encouraging that business outlook remains positive for the coming 12 months, further supported by the strong focus on innovation outlined in the latest Autumn Budget, it is also important that businesses look at all the ways they can successfully fund their growth,” said Mike Price, director at the MPA group.
Almost 80% of the businesses surveyed said their focus for the next 12 months is on hiring more staff and developing new products or services.
It seems that UK businesses are determined to work against the recent downgrade for productivity growth announced in the last Autumn Budget.
When asked how they will fund their planned growth, half of those polled said they would invest profits, while 57% feel that they do not need additional funding.
Under one third of these businesses plan to apply for R&D tax credits, despite 29% of them naming cash flow as the biggest challenge in achieving their aims.
“R&D tax credits offer a valuable cash injection which can be reinvested to support new business ventures, investment in equipment, or help to employ a greater number of skilled staff,” said Price.
“Recent figures from HMRC reported a 20% increase in the uptake of R&D tax credits in 2015/16 compared to the previous year. Yet, for thousands of businesses it remains a largely misunderstood, or even unknown scheme.
“It is therefore important that those businesses looking at growth in 2018 seek specialist advice; working with a tax credit specialist to identify and maximise qualifying R&D activity, but also one with the proven sector technical expertise and a clear understanding of HMRC requirements in this complex field.”