Earlier this week, HMRC suspended some R&D tax credit payments. This is because it is currently investigating what it calls irregular claims for some Research & Development tax credits.

If you are expecting an R&D tax credit payment, below is what we know about the situation so far.

Why is HMRC suspending some R&D tax credit payments?

HMRC says it is suspending payments for irregular claims. It says this is necessary to “ensure we prevent abuse of the relief”.

My R&D tax credit claim is accurate. Will payment be delayed?

HMRC says: “The majority of R&D relief claims are genuine and will be unaffected”. However, there will be delays to normal processing times, so it’s possible your payment may be delayed.

How can I make sure my R&D tax credit claim is accurate? 

We advise that you make sure you have fully completed the R&D section of your corporation tax return (CT 600). You can find the latest government guidance on completing your CT 600 here.

It’s also a good idea to submit additional information to support your R&D tax credit claim. This includes your R&D report. If you are a THP client, feel free to talk to your account manager for advice.

What counts as an ‘irregular’ R&D claim?

HMRC has not clarified which irregularities it is investigating. However, given it wants to “prevent abuse of the relief”, we expect it will be looking for fraudulent, incorrect or overstated claims.

What happens if I make an irregular claim?

If HMRC believes your claim is irregular, the action it will take will vary depending on the circumstances. If the taxman believes you deliberately made or hid an error, you can be fined as much as 100% of the tax lost. However, if you co-operate with HMRC after it finds an error, it may reduce this penalty.

Conversely, if you make an irregular claim in good faith and have taken reasonable care when preparing it, you may avoid a penalty altogether.

THP’s R&D tax credit experts can help you ensure your claims are accurate. Talk to us today if you’d like to learn more.

I’m still waiting for my money. Should I chase HMRC?  

HMRC has asked that claimants are patient and don’t contact its R&D helpline or mailbox for the time being. If THP is your agent, we can check your online account and find out the status of your claim.

Where can I learn more about R&D tax credits?

You can learn more by visiting our R&D tax credit service page. This gives you an overview of how R&D tax credits work, the types of relief you can claim and how THP can make sure your claims are processed as speedily as possible.

Need further advice on any of the topics being discussed? Get in touch and see how we can help.

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About Jon Pryse-Jones

Since joining THP in 1978, Jon Pryse-Jones has been hands on with every area of the business. Now specialising in strategy, business planning, and marketing, Jon remains at the forefront of the growth and development at THP.

An ideas man, Jon enjoys getting the most out of all situations, “I act as a catalyst for creative people and encourage them to think outside the box,” he says, “and I’m not afraid of being confrontational. It often leads to a better result for THP and its clients.”

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