R&D tax relief – claims submitted without additional information
By Susan Cattell, Head of Tax Technical Advisory
12 September 2023
We highlight the importance of submitting the additional information forms required for R&D relief claims from 8 August 2023; HMRC will reject invalid claims submitted without the forms.
Additional information required for R&D claims
From 8 August 2023, all companies making R&D relief claims must complete an additional information form (AIF) to accompany the claim. This applies to claims for both SME R&D relief and research and development expenditure credit (RDEC).
HMRC has provided guidance on who can submit the AIF (accessed from the guidance page) and the additional information required, which includes details of qualifying expenditure and contact details for the main R&D contact at the company and any agent involved in the claim.
Claims submitted without the AIF form from 8 August
Between 8 August and 3 September almost half the R&D relief claims received by HMRC did not have an accompanying AIF, which means they are invalid.
HMRC is writing to companies (and their authorised agents) where an R&D tax relief claim has been submitted without the AIF, explaining that the claim is invalid, and that the corporation tax (CT) return will be corrected to remove the claim.
Provided that the company is in time to amend the CT return, it can still make a valid claim to R&D relief by amending the return to reinstate the R&D claim and completing the AIF at the same time.
It is important to note that the requirement for an AIF applies to all claims made on or after 8 August, irrespective of the accounting period to which the claim relates.
Completing CT returns – Box 657
When completing the CT return which includes an R&D claim, the company should put an ‘X’ in Box 657 to indicate that the AIF has been submitted. However, there is a known problem affecting some claims to RDEC.
HMRC notes that some customers are unable to complete both boxes 655 and 657 on the CT600 and may get the following error message:
“Error 9283 — Box 655 can only be completed if at least one of the boxes 670 or 680 is greater than 0 (zero).”
Where this error arises HMRC provides the following guidance:
“If you get this error, do not make entries in boxes 655 and 657. You must still submit the additional information form to make a valid R&D expenditure credit claim.”
HMRC states that it will update the service in April 2024 to fix this issue. Until then, HMRC has agreed that it would be sensible for affected companies to use the white space on the CT return to explain that an R&D claim is being made and that the AIF has been completed.
Claim notifications – reminder of another new requirement
The AIF is not the only new requirement for R&D tax relief claims introduced in 2023. For accounting periods starting on or after 1 April 2023, some companies need to notify HMRC that they will be making a claim for R&D tax relief in advance of making the claim. The ‘claim notification’ must be submitted via an online form no later than six months after the end of the period of account.
HMRC’s guidance notes that the claim notification will be required where:
- The company is claiming for the first time.
- The company has claimed for the previous tax year, but that claim was not submitted until after the last date of the claim notification period (which ends six months after the last period of account).
- The company’s last claim was made more than three years before the last date of the claim notification period.
The guidance also sets out the submission deadline (including some illustrative examples), who can submit the claim notification, and the information required to complete the form. The claim notification form can be accessed from the guidance.
Let us know your views
ICAS responds to many tax calls for evidence and consultations, as well as producing tax policy papers and reports. We also regularly attend meetings with HMRC at which service levels, delays and other issues are discussed, and we raise problems being encountered by members. We welcome input from members to inform our work; email tax@icas.com to share your insights and feedback.