Learning from the R&D tax relief enquiry process

HMRC has been carrying out a mandatory random enquiry programme on claims made in 2020 and 2021 by small and medium-sized businesses to gain a better understanding of levels of non-compliance with research and development (R&D) tax relief regulations. While this endeavour is uncovering more fraud and error it is also catching genuine claims in its net.

As enquiries have become more commonplace we have found ourselves defending more than ever before. We stand by every single claim we have submitted and will support clients throughout the entire process.

Non-compliant claims

HMRC’s approach is not unwarranted. Its latest report found fraud and error in the fiscal year 2020-21 to be significantly higher than previously thought representing 24.4% of expenditure claimed for – up from a previous estimate of 5.5% for the same time period. The mandatory random enquiry programme found that 50% of all claims...