THE LASER USER
ISSUE 115 MARCH 2025 R&D TAX CLAIM
Understanding R&D pre-notification and the impact on your business
In the past few months, the landscape of R&D tax relief claims in the UK has undergone significant changes, in an attempt to tackle abuse and improve compliance. One of the changes was the introduction of a pre-notification requirement, which means companies must now notify HMRC of their intentions to claim R&D tax relief prior to making the submission.
What exactly is pre-notification for R&D claims?
Essentially, it’s a heads-up to HMRC that you intend to submit a claim. If your accounting period starts on or after 1 April 2023 and you haven’t claimed R&D relief in the last three years, you need to let them know within six months of your year-end. The notification can be submitted by either a representative of the company or an agent acting on behalf of the company. Pre-notification will only apply to new claims or companies that have not yet made an R&D tax relief claim during the three previous years.
What are the risks if you don’t comply?
If the ‘Advance Notification Form’ is not completed, this renders the R&D claim invalid, and if shown in the corporate tax return, it will be removed by HMRC as an “error”. This amendment cannot be rejected, and a new claim relating to the same expenditure as the original claim, cannot be made.
For example:
§ Company X contacted Visia1v in November 2024, wan1ng to claim R&D tax relief for year-ends 31st March 2023 and 31st March 2024. The es1mated claim benefit was £30,000 for Year 1 and £25,000 for Year 2.
§ The year ending 31st March 2023 is not affected because the Pre-no1fica1on rules only apply to accoun1ng periods star1ng on or aPer 1 April 2023.
§ However, the year ending 31st March 2024 is affected because, under the R&D pre-no1fica1on guidelines, Company X should have sent pre-no1fica1on to HMRC by 30th September 2024 (i.e. 6 months aPer the end of the accoun1ng period). This resulted in a loss of benefit of £25,000 for Company X
What’s the bottom line for companies planning their next R&D claim?
The key is awareness and timing. You need to know whether you fall into the category that requires pre- notification—don’t assume you’re in the clear just because you’ve claimed before or you think the new rules don’t apply to you. Working with reputable R&D tax advisors who stay on top of the latest HMRC guidance can be a lifesaver. They’ll run checks for you and guide you through each step of the process, so you don’t fall into these pitfalls.
If you have any further questions about pre-notification or innovation funding in general, please get in touch with Jean McCarthy, your dedicated Account Manager at Visiativ. E:
jean.mccarthy@
visiativ.co.uk | Tel: +44 7375 208512, to discuss your unique needs and explain how we can assist.
www.visiativ.co.uk Registered O+ice: 6 Atholl Crescent, Edinburgh EH3 8HA. Registered No. SC331999. 31
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