Following the recent modifications in the HMRC’s operational framework, the R&D Tax Relief programs underwent various alterations, effective from April 1, 2023. A notable shift is the necessity to provide advance notice to HMRC if you are planning to submit a claim.
Who is obligated to provide this advance notice?
The need to inform HMRC beforehand arises under these circumstances:
- If it’s your inaugural claim.
- If you had submitted a claim for the preceding tax year, but that claim was not presented until after the final date of the claim notification timeframe (the claim notification duration concludes 6 months post the end of the account period).
- If your prior claim was lodged over 3 years ago from the last date of the claim notification period.
To illustrate, if a business made an R&D claim in 2021 and anticipates submitting another in 2024, pre-notification isn’t mandatory (since a claim was made within the last three years). Conversely, if the last claim was in 2020 and the business plans to claim in 2024, a pre-notification must be sent.
When is the ideal time to inform HMRC about your claim intention?
The earliest opportunity to inform HMRC is the first day of the accounting period featuring qualifying activity. The deadline for notification is 6 months post the conclusion of the accounting period including qualifying activity.
To provide an example, if the accounting period incorporating qualifying activity spans from October 1, 2023, to September 30, 2024, the notification should be filed between October 1, 2023, and March 31, 2025.
What details should be included?
The claim notification form should contain the following:
- The company’s unique taxpayer identification (UTR).
- The chief internal R&D contact person in the company overseeing the R&D claim.
- The contact details of any representative assisting with the R&D claim.
- The start and end dates of the accounting period for which you’re claiming tax relief or expenditure credit.
- The account period’s beginning and end dates.
- A summary of the key planned projects, demonstrating how these activities align with the standard definition of R&D.
From August 1, 2023, it is obligatory to submit an additional information form to validate all your R&D tax relief or expenditure credit claims. This should be submitted either before or simultaneously with the electronic filing of your CT600.
These modifications will influence the way a claim is organised. Therefore, it is advantageous for all businesses engaged in R&D endeavors to consult with us to comprehend the implications of future claims and ensure compliance with all crucial deadlines.
If you have any questions, please do give us a call on 0333 009 0801 or email firstname.lastname@example.org.