Ian Davie
Senior Consultant
In the Spring Statement of March 2025, Chancellor Rachel Reeves announced proposed reforms to the UK’s £8 billion research and development (R&D) tax credit scheme. These reforms aim to address concerns about fraud and errors within the system and to improve accessibility for businesses. A key proposal is the potential introduction of mandatory advance assurances, requiring companies to confirm the eligibility of their projects for R&D tax credits before submitting claims. Currently, this advance assurance option is available but seldom utilised voluntarily.
The consultation published on Wednesday 26th March seeks to enhance certainty for claimants and reduce fraudulent claims. The three goals of the consultation are:
The consultation closes on the 26th May 2025.
Given the journey that R&D agents and companies have had with dealing with HMRC over the last two to three years, utilising a pre-approval process could make the process much easier. It may also make it a lot harder, with HMRC’s lack of a technical capability in assessing whether R&D that has been completed is R&D, to understand why proposed R&D in the future is R&D, when companies don’t have all the answers.
The existing R&D Advance Assurance process does not get used heavily because anecdotally HMRC were more likely to refuse you were going to be doing R&D than accept, so why apply? TBAT Innovation have never suggested that companies proceed down the R&D Advance Assurance route for this very reason. TBAT will certainly be contributing to this consultation.
If no further changes are made to the operation of the scheme and Advance Clearance becomes mandatory, then companies could have to justify their R&D claims up to three times:
Something has to be done to make the process easier for companies not harder.
If anyone reading this has experience of the existing R&D Advance Assurance process, I would be happy to hear from you! Book a free 1-2-1 consultation.
When it comes to claiming R&D tax relief, many businesses in design-heavy industries often ask the same question: Can we claim for the cost of acquiring designs? While buying existing designs does not qualify for relief, the good news is that further work to modify, develop or improve those designs often does. If your business is undertaking technical design work as part of an innovation project, there may be significant relief available.
From 1 April 2026, all tax advisers, including those involved in R&D tax claims, must be registered with HMRC and meet new minimum standards to act on behalf of clients. This move is part of HMRC’s drive to raise professional standards, reduce fraud, and improve oversight within the tax advisory industry. Learn who will be affected by these changes and what at your business needs to do to stay compliant.
Assists organisations in accessing research and development grant funding across a range of UK and EU schemes and industry sectors.
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