Who can notify HMRC of a potential R&D claim?
To complete the prenotification form you should be either a representative of the company, such as the Finance Director or MD, or an agent acting on behalf of the company. The form is digital and can be submitted using a Government Gateway ID.
Once you’ve submitted the form, you’ll receive a receipt from HMRC with a reference number which you will need should you need to contact HMRC about the submission.
You won’t receive a copy of the form itself, so make sure you save your own copy before you submit.
When do you need to notify HMRC about a potential R&D claim?
The rules around when to pre-notify are a little confusing. There are certain conditions which will exempt your client from having to prenotify. There’s also a specific deadline related to their accounting period.
Based on HMRC’s guidance we have produced a handy calculator to help determine if prenotification is required.
If your client has a longer period of account, the pre-notification deadline will be 6 months from the end of the longer period of account. For example, if it runs from 01 April 2023 to 30 June 2024, the notification period ends on 31 December 2024. If a claim has been made previously between 1 July 2021 and 31 December 2024 there will be no need to pre-notify. This window for the previous claim is based on the prenotification deadline, and therefore the end of the accounting period.
If the accounting period began before 1 April 2023, you do not need to pre-notify.
Why is it important to know when you need to prenotify?
If your client does not notify HMRC of a prospective claim by the deadline, their R&D claim will be automatically rejected. There is no flexibility for extenuating circumstances such as illness or anything else. So, if you make a mistake with the deadline, or the exemption period, your client will lose out on their entire R&D tax relief claim.
We’ve heard some R&D advisers saying they will pre-notify HMRC of every potential claim, regardless of whether they need to. This means they won’t accidentally miss out on a claim for a client, but it does potentially mean a lot of unnecessary work!
To complete the form, you need to gather the following information:
- the Company’s UTR (Unique Taxpayer Reference)
- contact details of the senior officer at the Company responsible for the R&D claim
- agent(s) contact details
- accounting period dates
- summary of planned R&D activities to show the project meets the standard definition of R&D.
Depending on your clients and processes, this is not a minor undertaking. This is especially true for the summary of R&D activity.
Based on what we’ve seen and heard from HMRC, they plan to use these summaries and other information from the form to flag up claims which could potentially be non-compliant. That means you need to take as much care with the summary as you would with any part of the claim itself. If you submit a hurried summary, you may be opening your client up to an enquiry that they would have avoided otherwise. This is a real own-goal if you were only filling in the prenotification form ‘just in case!’
What to do after pre-notification?
Once you’ve sent in the prenotification (or safely determined you don’t need to) you can then continue your claims process as you would do otherwise. Don’t forget to complete the Additional Information Form for any R&D claim submitted from 8th August 2023 onwards!
Take a look at our free resources for more information on all stages of the claims process: