Is your business claiming or thinking about submitting R&D claims?
HMRC have updated their legislation for claims submitted after 1st August 2023 to include more administrative effort and may lead to claim payment delays.
Businesses should not be deterred from making legitimate R&D claims and should instead, seek our advice before making any claims.
HMRC estimates £0.5bn of qualifying expenditure is wrongly claimed every year through error or fraud and so are now reviewing new claims much more carefully. HMRC have set up a specialist team in its Fraud Investigation Service to challenge and block such claims.
There are two changes that will affect all R&D Claims:
1. A requirement to provide additional information before an R&D claim is made, and
2. A requirement for certain companies to make a claim notification within 6 months after the end of the accounting period for which they want to claim R&D relief.
Additional Information Form (AIF)
For any claim made on or after 1st August 2023, irrespective of your Company year end, it must be submitted to HMRC before the Corporation Tax Return is filed. File the return without filing the AIF, all R&D reliefs will automatically be invalid and removed.
The requirements of the AIF are quite thorough, and the stricter rules include the need to:
• Identify any advisor who has assisted with the claim.
• Identify the responsible internal person within the company itself.
• Details of the Company, contracts, and qualifying expenditure broken down by project.
• Detailed description of each project including technological uncertainties, how they were overcome and showing systematic R&D activities.
Claim Notification Form (CNF)
New claimants or those who haven’t claimed for three years will need to complete this CNF for claims for accounting periods beginning on or after 1 April 2023. This must be submitted within the “claim notification period” This is 18 months from the start of the accounting period in which the claim sits, meaning the deadline is 6 months after the end of the period of account that the claim relates to.
If you are looking for assistance on the journey to more efficient accounting and tax services, PGR have the capacity to help, contact Anna on 028 9078 8880 to find out more.