This Practice Note sets out what constitutes qualifying capital expenditure for the purposes of R&D allowances and how the deduction (of up to 100%) may be claimed. Research and development (R&D) capital allowances are available to all taxpayers carrying on a trade, not just companies. Therefore, an individual, or partnership of individuals, which cannot claim R&D tax relief, can generally still claim R&D capital allowances, although R&D capital allowances are not available to taxpayers that calculate their profits on the cash basis (subject to an exception for expenditure on the provision of a car). Where an item of expenditure could qualify for other capital allowances (such as plant and machinery allowances), the trader needs to choose which allowance to take. Only one form of capital allowances may be claimed on an item of capital expenditure. In addition, it is not possible to claim R&D capital allowances in relation to the same expenditure for more than one trade. Following the Finance Act 2014, R&D allowances are no longer affected by any restrictions imposed on a company under Part

Tax analysis: In MW High Tech Projects UK Ltd, the First-tier Tax Tribunal (FTT) upheld HMRC’s decision to refuse a R&D expenditure credit (RDEC) claim where the taxpayer’s statutory accounts for the relevant years stated it was not a going concern.

This Practice Note is about the R&D expenditure credit (RDEC) scheme that applies for accounting periods beginning before 1 April 2024 (subject to transitional provisions). Legislative references in this Practice Note are to the versions applicable immediately before the transition away from the pre-1 April 2024 rules. This Practice Note uses the present tense relatively to describe the pre-1 April 2024 regimes in the latest form in which they applied, unless otherwise indicated. For information about the main research and development (R&D) relief scheme for small or medium-sized enterprises (SMEs) for accounting periods beginning before 1 April 2024, see Practice Notes: SME R&D relief—additional deduction (pre-1 April 2024) and SME R&D relief—tax credit (pre-1 April 2024). Together, these two pre-1 April 2024 schemes are referred to in this Practice Note as the pre-1 April 2024 schemes. For information about the schemes of relief for R&D generally applying for accounting periods beginning on or after 1 April 2024, see Practice Notes: The merged R&D expenditure credit (post-1 April 2024) and Enhanced relief for loss-making R&D-intensive

This Practice Note about is about the meaning of R&D for the purpose of the following four R&D relief schemes (which are subject to detailed commencement and transitional provisions): • the research and development (R&D) relief scheme for small or medium-sized enterprises (SMEs) for accounting periods beginning before 1 April 2024—for more information, see Practice Notes: SME R&D relief—additional deduction (pre-1 April 2024) and SME R&D relief—tax credit (pre-1 April 2024) • the R&D expenditure credit scheme that applies for accounting periods beginning before 1 April 2024—for more information, see Practice Note: R&D expenditure credit (pre-1 April 2024); together, these first two schemes are referred to in this Practice Note as the pre-1 April 2024 schemes • the merged R&D expenditure credit scheme applying for accounting periods beginning on or after 1 April 2024—for further information, see Practice Note: The merged R&D expenditure credit (post-1 April 2024), and • the enhanced relief for loss-making R&D-intensive SMEs applying in full for accounting periods beginning on or after 1 April 2024—for further information, see Practice Note: Enhanced relief for R&D-intensive

Principal legislation The main legislation governing this area is: • the Bribery Act 2010 (BA 2010) • the Proceeds of Crime Act 2002 (POCA 2002) • The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), SI 2017/692 • the Fraud Act 2006 (FA 2006) Bribery Act 2010 BA 2010 came into force on 1 July 2011. It sets out four bribery offences which can be committed by corporations and individuals, has wide territorial jurisdiction and imposes severe sanctions. A bribe is defined as ‘a financial or other advantage’ so is not confined to monetary payments. Penalties for a corporation are an unlimited fine and for an individual up to ten years imprisonment. Companies convicted under the legislation can be permanently barred from tendering for public sector contracts under the Public Contracts Regulations 2015, SI 2015/102, reg 57(1)(c). In addition to any criminal penalty, a company can also be fined by a sectoral regulator (eg the Financial Conduct

What are the main laws and regulations governing this area? There are three main sources of environmental law that an insolvency practitioner (IP) should be aware of and which may result in personal liability for the IP. These are: • contaminated land legislation (the Contaminated Land Regime) • other regulatory regimes (expanded below), and • third party civil claims Contaminated Land Regime Local authorities have a duty under Part IIA of Environmental Protection Act 1990 (EPA 1990) to: • investigate their areas for the presence of contamination • identify contaminated land, and • require clean-up where appropriate If the authority identifies contaminated land, liability for cleaning up the contamination rests initially with Class A persons. This can be: • the original or subsequent polluter—Class A ‘causers’, or • any persons who knowingly permit contamination—Class A ‘knowing permitters’ (ie someone who is aware of contamination and who is in a position to do something about it but fails to do so—for example, if an IP is aware that oil drums stored on a property

What is the main legislation covering this area? The main legislation concerning health and safety is the Health and Safety at Work etc Act 1974 (HSWA 1974). HSWA 1974. This: • sets out: ◦ the broad health and safety duties which may apply in a work context, ◦ the enforcement regime for ensuring duties are properly discharged • enables subordinate legislation to be made There are more than 600 subordinate regulations which have been made under HSWA 1974. Quite often the regulations set out prescriptive obligations which must be adhered to. The regulations fall broadly into three categories and deal with: • the way in which particular activities must be carried out • management of health and safety functions, and • issues specific to the sector or industry As such, in any given case much of the subordinate legislation will not be applicable. However, it is important in each case to be aware of the applicable legislative framework. In addition, the Health and Safety Executive

Why is this immigration law relevant to insolvency practitioners and their staff? Legislation applicable generally In the first instance, employers have a duty to prevent illegal working in the UK by carrying out prescribed document checks before employing someone under a contract of employment, service or apprenticeship, whether expressed or implied and whether oral or in writing. This ‘right to work’ check is to ensure that an individual is lawfully allowed to undertake the work in question. It is also important that the employers establish whether or not individuals are employees, self-employed, contractors or sub-contractors as only employees require a ‘right to work’ check. As the worker status of an individual can sometimes be difficult to ascertain, employers often need to seek legal advice from an employment or immigration practitioner. Should the Home Office discover that an employer is employing an individual who does not have the right to undertake the work in question; an employer may be liable for a civil penalty of up to £20,000 per illegal worker. In addition

It is not uncommon for bankruptcy practitioners to encounter concurrent bankruptcy and matrimonial proceedings. In some instances, the bankruptcy proceedings may have been instigated by one spouse with the intention of defeating the other's financial claims upon divorce. Principal legislation The Matrimonial Causes Act 1973 (MCA 1973) governs the divorce process in England and Wales. MCA 1973 was amended by the Divorce, Dissolution and Separation Act 2020 (DDSA 2020) in order to introduce ‘no fault’ divorce in England and Wales for applications made on or after 6 April 2022. For applications made prior to 6 April 2022, divorce was only possible if one party claimed the marriage had broken down irretrievably on the basis of ‘facts’ such as the other’s adultery or unreasonable behaviour or abandonment, or if the parties had lived separately for two years and consented to divorce. Defended cases led to a public trial in which the applicant had to prove the factual basis of the divorce. DDSA 2020 means that

Reducing Risks Protecting People: A document which describes the decision-making process of the HSE. It aims to make the procedures and protocols which the HSE follows transparent so as to ensure that the HSE's decision-making process, including risk assessment and risk management, is perceived as valid.

The Association of Business Recovery Professionals (R3) has appointed Tom Russell, licensed insolvency practitioner and director at James Cowper Kreston, as its new president. Russell's presidency comes as the government plans reviews of insolvency regulation and the personal insolvency framework. His agenda focuses on membership growth, technological advancement, stakeholder engagement, demonstrating the profession's value, and career development amid rising economic pressures on UK businesses and consumers.

R3, the UK’s insolvency and restructuring trade body, has appointed Bristol restructuring expert, Tim Sloggett, as the new South West and Wales chair of R3. Sloggett, who is a managing director in the financial advisory team at independent advisory firm Quantuma, takes over from Charlotte May, associate director for the South West and Wales at Manolete.