HMRC’s defeats on subsidised and contracted out R&D

Two recent First-tier Tribunal cases – Collins Construction Ltd v HMRC [2024] UKFTT 951 (TC) and Stage One Creative Services Ltd v HMRC [2024] UKFTT 1059 (TC) – address the meaning of ‘subsidised’ and ‘contracted out’ in relation to R&D relief. As many practitioners will be aware these two topics have been subject to significant uncertainty over the last few years with HMRC taking a very restrictive interpretation on both points. Collins and Stage One are both lead cases that went to the FTT with around ten other cases stayed behind them and potentially dozens more at various stages of enquiry and appeal. As such these cases shed important light on the situation for many companies where similar matters are at hand and the tribunal’s rejection of HMRC’s arguments may go some...