Helen Adams and Carrie Rutland (BDO) provide a practical guide.
Research and development (R&D) tax reliefs are an important tool for encouraging companies to invest and innovate with the aim of benefitting the UK economy. HMRC’s Corporate Intangibles Research and Development Manual (at CIRD80525) acknowledges that ‘specialist R&D units have a role in promoting the R&D tax relief schemes’ and will ‘focus on improving the consistency of claims treatment ... and on achieving a balanced focus on non-compliance’. HMRC receives tens of thousands of claims annually and recently estimated that the level of fraud and error in relation to them is 16.7% (or £1.13bn) in 2020/21. Consequently HMRC conducts compliance checks to tackle this aspect of the tax gap and ensure that only those businesses that undertook genuine R&D activities obtain appropriate relief.
Opening the compliance check
Usually compliance checks commence as CTSA enquiries (FA 1998 Sch 18 para...
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Helen Adams and Carrie Rutland (BDO) provide a practical guide.
Research and development (R&D) tax reliefs are an important tool for encouraging companies to invest and innovate with the aim of benefitting the UK economy. HMRC’s Corporate Intangibles Research and Development Manual (at CIRD80525) acknowledges that ‘specialist R&D units have a role in promoting the R&D tax relief schemes’ and will ‘focus on improving the consistency of claims treatment ... and on achieving a balanced focus on non-compliance’. HMRC receives tens of thousands of claims annually and recently estimated that the level of fraud and error in relation to them is 16.7% (or £1.13bn) in 2020/21. Consequently HMRC conducts compliance checks to tackle this aspect of the tax gap and ensure that only those businesses that undertook genuine R&D activities obtain appropriate relief.
Opening the compliance check
Usually compliance checks commence as CTSA enquiries (FA 1998 Sch 18 para...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
