HMRC tended to devote resources and a caring eye to making sure that small businesses were able to claim the relief they needed. After all, that’s the real driving purpose of the scheme!
What came to pass last year was a far sight different.
HMRC increased the number of caseworkers that they have on staff but stripped back how much they communicate with claimants. This coincided with requirements for new forms and processes, restrictions of eligibility criteria, and a vastly increased rate of enquiries.
If your experiences are anything like those of our members, you’ve probably found R&D tax relief a difficult industry to navigate over the past year.
The good news is that, on the policy front, HMRC seem willing to make things a little easier on claimants and advisers. Hopefully that shift in attitude bleeds over to HMRC’s compliance team, but it’s not usually a good idea to base a business plan on hopes and prayers.
So, while the scheme’s guidance might get easier to work with, don’t hold your breath that the compliance team will change their approach right away. Over time the policy and compliance teams’ attitudes should hopefully line up more closely.
Strengthening your R&D claims
In the meantime, we’ve identified some measures that you can take to increase your chances of a successful claim and stave off the questioning eye of HMRC. You can read more about them in our recent articles:
- Working with clients to adapt to HMRC’s new approach to R&D
- The importance of a clearly defined technological baseline in an R&D claim
- How to identify “problematic” historical R&D claims
If you’re looking for more support to adapt to the current state of R&D tax relief, you may be interested in our recently-refreshed membership offering. We have new training courses on the R&D scheme, new ways to help you win clients, more ways to answer your questions, and a new lower price-point for anyone working alone.
New R&D tax relief training
First and foremost is our catalogue of training courses.s
Our most popular new course covers the Additional Information Forms. It includes a detailed overview of the ins-and-outs of the form and templates that you can use to ensure your processes remain consistent from claim to claim.
We will also be launching a new course next month on the Merged R&D Scheme. HMRC is making some big changes this year, and this course will tell you all about it!
Marketing your R&D service
As part of their heightened scrutiny, HMRC has increasingly used a business’ marketing messages as contributing evidence to prompt or support enquiries.
You’ve probably seen the worst offenders. Advisory services that promise “100% success rates” and “free money”, completely missing out the realities of constructing and submitting a claim.
While that end of the spectrum stands out, there are other easily-missed messages that might harm your business. Usually these are as simple as outdated information or incomplete referencing of HMRC guidelines.
Our recently released course (“How to build Strong Ethics & Good Marketing Practice into your R&D Service”) centres around ethically marketing your R&D service, with topics including:
- Explanation of HMRC’s Standard for Agents & PCRT, and how those apply to you when preparing R&D claims,
- Practical tips on how to centre your R&D service on your ethics and the business benefits that this brings,
- What constitutes good and bad practice when talking about the R&D scheme, your service, your customers, and your relationship with HMRC.
With the support of our members, we’ve also developed our Good Practice Marketing Standard. This aims to define ethical marketing in the context of R&D tax relief, and R&D Community members whose websites meet the standard will have a badge featured on their members directory entry.
We’re in the final stages of rolling out these features, so check back soon for more information about marketing your R&D service.
R&D tax relief support
While these courses might help form a more complete understanding of guidance and policy, what can you do about tricky one-off questions about HMRC guidance and how it applies to your unique situation?
That’s where tools like our R&D Helpline come into play.
The Helpline saw a lot of activity in 2023, and we’re glad that it did! The insightful questions posed by our members yielded information that we might not have uncovered on our own. We routinely feed that information into our work to produce better and more complete training materials.
Our members-only forum also saw frequent flurries of activity, especially when new guidance was published or HMRC brought in new documentation measures. It’s a key element of support for our members, especially those that work in smaller teams. You can easily forget how reassuring a second opinion can be, even if it’s about something you’re 99% sure of.
Plus, The R&D Community members are a group that really know their stuff. We’d challenge you to find a better forum for conversation about the nitty-gritty of the R&D tax relief scheme.
The R&D Community Practitioner membership
Because it was such a difficult year, a lot of R&D experts found themselves under pressure in large consultancy firms, or were let go from companies that floundered in the new environment. Maybe you did too, and became one of the many consultants who set up a small business of their own.
To accommodate this new cohort, we created a special Practitioner Membership tier of The R&D Community. This is a brilliant option if you’re working alone, as it costs less than a Corporate membership, yet still provides you with all the training and support you need.
Sounds good? Read all the details and sign up today!