SEPT 2023 New HMRC Notification and Claim documentation rules

RD Claims – Additional Information Requirement effective 01 August 2023.

MARIA KITT, Director Tax Insight explains HMRC now required additional information to support ALL claims for RD incentives & Reliefs, with some companies being required to make advanced notification of their intention to claim. Unsurprisingly, the new system has quickly weeded out deficient claims that lack substantiation and -proof is in the pudding – this protects HMRC from paying tax credits where a claim is not supported with the relevant documents. However I was surprised by the statistic which shows that of the claims filed to date, almost half are unsupported……

Dear members,[ of HM Treasury Consulting Group]

HMRC recently introduced new rules for Research and Development (R&D) relief claims, including the requirement for APs beginning on or after 1 April 2023 for some claimants to submit a Claim Notification, and for all claimants to complete an Additional Information Form (“AIF”) for all claims from 8 August 2023. The AIF is a digital service available on gov.uk.

The AIF has been mandatory for four weeks now and we appreciate the large number of customers who have successfully submitted their completed form alongside their CT600, ready for validation by HMRC’s systems.

We have found, however, that almost half of all claims we have received so far (between 8 August and 3 September) have been submitted by customers without the required AIF. This week we will begin writing to those customers – and, where authorised, their agents – to explain that their R&D claim is invalid and to tell them what they need to do to make a valid claim. We attach an example of the letter we will be sending out.

Our Customer Service teams are issuing these letters beginning with the earliest CT returns received. From September, this will be a standard automated process and, where necessary, customers will receive notice of any correction much quicker going forwards.

You can find the guidance relating to R&D on the GOV.UK pages ‘Research and Development tax relief’ and ‘Claiming R&D tax reliefs’. Further details can also be found in the attached letter