Changes to the R&D rules

As of today, companies and their advisers should take careful note of HMRC’s new rules relating to the filing of R&D tax credit applications.

In order to ensure that its tax incentives continue to encourage private sector investment into innovative companies, without overpaying to the wrong people, the government has tweaked the legislation relating to how companies file their R&D tax credit applications.

From today (1 April 2019), any amendment to a corporation tax return that includes an R&D tax credit claim will need to be accompanied by a full CT600 and computation. Failure to do so will result in the claim being rejected by HMRC, and for SMEs that could be the difference between survival and insolvency.
It is also worth noting that there have been some other recent changes:

1.       The release of new guidance in October 2018 on software R&D, a notoriously tricky area;
2.       A new PAYE/NIC cap for the SME credit; and
3.       A new online service for submitting R&D tax credit claims.

Now more than ever, companies need to take extra care to ensure that they are making the correct claim, at the right time and in the right manner. For those companies that have specialist R&D advisers as well as their regular accountants/auditors, it is vital that they work as a team to make sure that nothing falls between the cracks.

If your company has and R&D tax credit that you would like to borrow against, or if you would like to have a chat to discuss any of the above, please do get in touch with us.