Regardless of the value of your tax relief claim, there is a small risk that HMRC might enquire into the tax return.
However, by working closely with accountants and planning the practicalities of submitting the claim, this risk can be minimised.
One key factor is to ensure that HMRC receive the figures and technical report together.
We have only seen cases of enquiries into R&D tax relief claims when HMRC have received a tax return claiming R&D without the technical report to back up the figures. Naturally, HMRC might want to know the credibility behind the figures on the return before agreeing to pay out a hefty tax credit.
One of the easiest and hassle-free ways in which to submit your claim is for us to provide amendments to the corporation tax returns already submitted to HMRC. This is done directly with the R&D specialist team at HMRC under your authority which makes us your ‘R&D tax agent’.
Where R&D tax relief claims have not been done by your company previously, we are usually looking at a return or returns that have already been submitted. In those cases, we include amended tax returns and computations with our technical report so that they are received by HMRC simultaneously.
Where this is agreed with accountants we can continue to work in this way with subsequent claims. However, we appreciate this is not does not work for everyone and we always want to work with your accountant, not against them.
In some cases, your accountant may want to preserve the responsibility of submitting the claim. Alternatively, if a corporation tax payment deadline is looming it would make sense that they submit a return with the claim inclusive figures.
In this instance, we can provide a supporting pack to accountants which explains the basis of the R&D figures being claimed and how it should be reported to HMRC. These usually include advice for the return to be submitted on an estimated basis or a disclosure explaining that a supporting technical report is to follow.
Working with accountants to take these precautions will help to avoid unnecessary additional scrutiny before the supporting technical report is submitted.
In either case, a good working relationship and understanding with your accountant is of paramount important and we will always want to discuss the best way of working for everyone.
Would you like to find out more about our R&D Tax Credits services? We'd love to hear from you. Click the link for a free consultation. We have 100% success rate on our tax credit claims, so it's well worth talking to us to see if you're eligible.