Form submitted!
Thank you for getting in touch. A member from our friendly team will aim to get back to you shortly.
All the best,
The SK Accountants team
Thank you for getting in touch. A member from our friendly team will aim to get back to you shortly.
All the best,
The SK Accountants team
Thank you for getting in touch. A member from our friendly team will aim to get back to you shortly.
All the best,
The SK Accountants team
Thank you for getting in touch. A member from our friendly team will aim to get back to you shortly.
All the best,
The SK Accountants team
A crackdown on suspected Research and Development (R&D) tax credits fraud by HM Revenue & Customs (HMRC) has led to a fall in claims for the first time.
The value of R&D tax credits relief claimed by UK businesses has fallen by £275 million in a year.
But R&D tax credits play an important role in the UK economy as they give businesses an incentive to improve productivity and drive innovation.
They work by either reducing a company’s liability to Corporation Tax or by making a payment to the company. The rate of relief depends on whether a company is an SME or a large company
But new research has found that the value of claims fell by four per cent from £6.9 billion in 2019/20 to £6.6 billion in 2021/21.
Following a rise in suspected fraud in 2020, HMRC took a more robust approach by increasing the scrutiny and delaying approval claims for R&D tax credits.
The majority of irregular R&D tax credit claims are usually based on innocent and genuine mistakes, but the penalties can be serious.
In many cases, businesses are acting on the advice of unscrupulous R&D agents who do not have the requisite experience or qualifications. HMRC has been empowered to tackle these rogue tax advisers.
To benefit from R&D tax credits, you must:
Work that qualifies for R&D relief must be part of a specific project to make an advance in science or technology.
The relief allows companies to reduce their corporation tax bill based on the money spent by the business on research and development projects.
R&D grants cover several areas including:
The drop in R&D claims approved comes following a wave of suspected misuse of the R&D credits schemes in 2020. HMRC is now attempting to clamp down on ‘error and fraud’.
HMRC extended the deadline for processing R&D tax credits from 28 days to 40 days in June 2022 due to ‘increased scrutiny’.
Need help with R&D tax credits or related matters? Contact us.
Small business confidence dips ahead of new customs controls coming into force
Four in 10 exporters have reported a fall in international sales since the end of the Brexit transition period, a major study has revealed. According to the tracker, four in 10 – around 41 per cent of traders – have reported a “drop off” in international sales in the three months to September 2021.
Business
HMRC asks sole traders to correctly report SEISS grants or “repay in full”
Sole traders who have not correctly reported their Self Employment Income Support Scheme (SEISS) grants may be forced to repay them in full, it has been warned.
Compliance
Small businesses call for Government support to tackle climate change
According to new research, many are addressing energy usage, increasing recycling and investing in microgeneration, but only a third of those have a formal plan to tackle climate change within their business.
Economy
Almost 800,000 tax scams reported to HMRC in past 12 months, figures reveal
Nearly 800,000 tax-related scams were reported to HM Revenue & Customs (HMRC) in the past 12 months, a major study has revealed. According to the report, HMRC responded to 797,010 referrals of suspicious contact from the public in the last year. Around 358,000 of these involved scams where taxpayers were offered bogus tax rebates.
Tax Planning