R&D tax relief administration, interaction with other reliefs and anti-avoidance

Produced by Tolley
R&D tax relief administration, interaction with other reliefs and anti-avoidance

The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • R&D tax relief administration, interaction with other reliefs and anti-avoidance
  • Claims for R&D tax relief
  • Advanced R&D assurance for small companies
  • R&D anti-avoidance
  • R&D: interaction with quarterly payments
  • R&D: interaction with the patent box regime
  • R&D: interaction with creative sector tax reliefs

The following paragraphs set out details of theadministration of R&D claims, theinteraction with other tax provisions and anti-avoidance rules. For further details of SME R&D tax relief, see theResearch and development SME tax reliefs guidance note and for details of research and development expenditure credit (RDEC) see theResearch and development expenditure credit (RDEC) guidance note.

For information on theoperation of theR&D regime and theprocessing of claims in light of thecoronavirus (COVID-19) pandemic, see theCalculating trading profits after coronavirus (COVID-19) guidance note.

Claims for R&D tax relief

Claims for R&D tax relief must be made by including theclaim in thecompany’s tax return either in theoriginal submitted return or through an amended return. The time limit for submission of theclaim is thefirst anniversary of thefiling date for thecompany’s tax return for theaccounting period for which theclaim is being made. For example, if theaccounting period was theyear to 31 December 2020, a claim would need to be submitted to HMRC by 31 December 2022.

Claims can be supported by a simple report as a pdf attachment to thereturn or via HMRC’s online template. The online template is intended to provide a standardised format in which claims can be supported. It is not dissimilar in concept to themore familiar personal tax return format. There are two sections that must be completed. The first section requires that thefollowing set of questions be answered:

  1. what was thescientific or technical knowledge at thestart of theproject?

  2. what was thegap in technological knowledge or capability that theproject aimed to overcome?

  3. what types of scientific or technological uncertainties did thecompany face in achieving thedesired advance?

  4. how did your project overcome thetechnological uncertainties?

The second section covers therelevant cost information. The R&D costs have to be provided on a project-by-project basis. This may result in more work

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