The British fintech sector is booming with record amounts of investment being pumped into an ever-increasing number of businesses.
More than £7.6 billion was raised by UK-based fintechs between 2014 and 2018. Despite the uncertainty of Brexit, investment within the UK sector more than trebled from £685.3 million in 2014 to almost £2.4 billion in 2018.
In terms of deal activity London sits second only to the Silicon Valley and it has been steadily closing the gap. In broader global terms, the UK’s fintech sector ranks third behind China and the US in investment and leads the way amongst European nations according to Innovate Finance.
One of the attractive propositions of investing in UK-based fintech businesses is the potential for companies to secure generous incentives through the tax relief scheme on some of their innovation expenditure. The UK Government’s research and development (R&D) tax relief scheme offers innovative companies – and there are many within the fintech sector – up to 33p for every pound spent on qualifying R&D (dependant on the company status and its financial position). In a strive to maintain the country’s position as a global leader in science and technology, the scheme offers those investing in product or process improvements significant tax breaks provided they meet the required criteria.
Article originally published on Banking Tech
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