Research & Development (R&D) rule change for Claims

From now on, HMRC might require a Pre-Notification Form to be submitted, within six months after the company’s year end, if you wish to make an R&D claim. This new rule applies to accounting periods beginning on or after 1 April 2023, and therefore the first ‘full’ accounting year this might impact is the year ended 31 March 2024. If a Pre-Notification Form needs to be filed for the year ended 31 March 2024, the form must be filed by 30 September 2024.

All companies who have not made an R&D claim before, or not done so within the last three years, need to submit this Pre-Notification Form.

Please note that if you have made an R&D claim within the last three years on an original (not an amended) tax return, you will also not need to file a Pre-Notification Form. Strictly, the ‘last three years’ means the three years prior to the due date of the Pre-Notification Form. So, for a 31 March 2024 year, if your company has submitted an R&D claim in the period from 1 October 2021 to 30 September 2024, it should not need to file this form. However, if the only R&D claim which was submitted in that three year period was via an amended tax return (not the originally-submitted return), and that amendment was submitted after 1 April 2023, then that R&D claim is ignored for the purposes of determining whether you have submitted a claim in the last three years. The position is, therefore, complex.

Failure to submit a Pre-Notification Form, if one is needed, will result in the company being unable to make any R&D claim for the period in question.

If your company has a 31 March 2024 year end and you are considering making an R&D claim for the first time, or the first time since 2020 or earlier, get in touch, as this will mean you need to file a Pre-Notification Form before 30 September 2024.

The requirement to consider a Pre-Notification Form will continue on a rolling basis, so will need to be considered for all companies from now on, for example companies with a 31 December 2024 year end will need to submit a Pre-Notification Form, if required, by 30 June 2025.

There’s no doubt about it; the R&D landscape is changing. It is more important than ever Claims are robust and timely.  Please click here to get in touch…