Following the review of R&D tax reliefs launched by the Chancellor in his 2021 Budget, the Government has this week announced several changes which will apply to the UK’s Research & Development Tax relief rules for accounting periods beginning on or after 1 April 2023.
Some of the changes in legislation are minor, however, others could have a significant impact on companies seeking to claim R&D tax reliefs, particularly those making new claims.
HMRC have also been granted new powers to reject claims and claim back excessive tax credits. This means that businesses will need to make preparations early on in the R&D claims process if they wish to ensure that their R&D claim is successful.
Below, we have summarised some of the points which you might find helpful.
R&D claims: tackling abuse and improving compliance
With effect from April 2023, it will be mandatory that all Corporation Tax returns that contain a R&D claim, including amended returns, must be submitted digitally through HMRC’s tax return portal.
R&D claims: provision of additional information
This new requirement requests additional information be provided in relation to a R&D claim. This information will include a description of the R&D undertaken, breakdown of qualifying costs, detail of any agent who has advised on the R&D claim, and space for the signature of a senior officer of the company.
R&D tax reliefs: Pre-notification
If a business has not claimed R&D tax relief in the last 3 years, it will be required to pre-notify HMRC of its intent to claim within 6 months of the end of the claim period.
HMRC has not yet released details of how this notification should be made, but it has been confirmed that claims which do not comply will be automatically rejected.
If you would like to speak to a member of our specialist R&D Tax team about making an R&D tax claim or to consider whether your business might qualify for R&D Tax Reliefs, please contact us on 020 7330 0000.