The UK Government has long encouraged businesses to invest in Research & Development (R&D) projects, believing it to be at the forefront of economic growth.
R&D tax reliefs are, therefore, attractive to companies, with independent schemes currently benefitting both SMEs and larger organisations.
However, when planning to claim R&D tax relief or expenditure credit, some companies must now notify HM Revenue & Customs (HMRC) of their intentions prior to making the submission.
In an attempt to crack down on abuse of the R&D tax relief system, HMRC introduced reforms which became effective for accounting periods beginning on or after 1st April 2023.
Who should notify HMRC?
Companies who are planning to claim R&D tax relief must now notify HMRC if they:
- Are claiming for the first time.
- Have claimed for the previous tax year but did not submit that claim until after the last date of the claim notification period (the claim notification period ends six months after the end of the period of account).
- Have a claim that was made more than three years before the last date of the claim notification period.
R&D: Notification deadlines
The deadline for submitting claim notification forms is six months after the end of the period of accounts that the claim relates to. For example, for a period of account ending 31st March 2024 the deadline for the notification is 30th September 2024. Any submission put in after this deadline will not be valid.
The notification can be submitted by either a representative of the company or an agent acting on behalf of the company
What information will you need to complete the claim notification form?
The claim notification form requires thorough checking before being submitted, as any omissions or errors could lead to claims being rejected outright.
All forms need the following the details:
- The company’s Unique Taxpayer Reference (UTR)
- The name of the senior R&D contact who is responsible for the claim – for example, a company director
- Contact details of any agent involved
- The accounting period start and end date for which you’re claiming the tax relief – note, this must match the one shown in your Company Tax Return
- The period of account start and end date
- A summary of the high-level planned activities and evidence the project meets the standard definition of R&D
Once a claim notification form has been submitted online, an email will be sent which will contain a reference number to be kept on record. This number should be quoted when discussing the claim notification form with HMRC.
From 1st August 2023, an additional information form must be submitted to support all claims for R&D tax relief. This will give you the opportunity to explain in detail about your project and to evidence its R&D properties.
This form must be submitted or else HMRC will be unable to process your claim.
R&D claims support from trusted advisers
For more information about the R&D relief changes, and what to include on your notification form, please contact our team for expert advice.