Alongside ongoing high levels of compliance checks, at the end of October HMRC published new guidance material to help taxpayers to determine whether work that they undertake qualifies as R&D for tax purposes. Expenditure on qualifying projects may be able to benefit from significant tax reliefs.

The new Guidelines for Compliance expand on HMRC’s view of the guidelines published by the Department for Science, Innovation and Technology (DSIT) (link) on the meaning of R&D for tax purposes. HMRC expects these to be read together with the DSIT guidelines when preparing R&D claims.

These new Guidelines set out:

  • HMRC’s expectations of claimants
  • who is a competent professional, able to judge if a project is seeking an advance in science or technology for the purposes of an R&D claim
  • how to identify qualifying R&D projects
  • a recommended approach to claims and record keeping.

Potential claimants should also consider the recently-introduced new information requirements for all R&D claims, as explained in our previous update here (link).

The new Guidelines are available to view on GOV.UK:

The DSG tax team is experienced in dealing the preparation of R&D claims and will always be pleased to provide advice on the regime and what does/doesn’t qualify, and to assist with the preparation of appropriate claims.