HMRC have been consulting recently on ways to improve the take-up and administration of Research and Development claims by companies - in fact the title of their consultation was "Making R&D Easier"!!
Following on from this consultation there will be a number of improvements to the current system and I believe that a key improvement will be a new Advance Assurance facility. How it will work:
We are still awaiting the final documentation to appear on the HMRC website, but I would expect it within the next 2 weeks. This is very good news and will provide tax certainty, at least, for those companies venturing into the world of R&D for the first time.
The other improvements to come out of the consultation are in the following areas:
So, overall good news for a dark November day.
Following on from this consultation there will be a number of improvements to the current system and I believe that a key improvement will be a new Advance Assurance facility. How it will work:
- Companies already undertaking R&D, or more importantly those intending to undertake R&D, will be able to submit an Advance Assurance form in relation to the specific R&D of the business.
- If the Advance Assurance is successful, it will mean that the first 3, yes 3, years of R&D claims by the company will be processed without any further enquiry into the claims
We are still awaiting the final documentation to appear on the HMRC website, but I would expect it within the next 2 weeks. This is very good news and will provide tax certainty, at least, for those companies venturing into the world of R&D for the first time.
The other improvements to come out of the consultation are in the following areas:
- Treatment of sub-contractors in the R&D tax relief schemes will be reviewed, as this is a notoriously "grey" area.
- More concise examples to be provided in relation to explaining "appreciable improvement".
- A commitment from HMRC to assist companies by providing upfront certainty to smaller tech start-up companies investing in software development - another notoriously difficult area to navigate your way through.
So, overall good news for a dark November day.