R&D tax credits explained

In most cases, you must submit your R&D claim within two years of the end of the accounting period in which the qualifying spend was incurred, and make sure any required submissions (such as the claim notification form and the Additional Information Form) are filed on time as part of the process. If you want a quick answer for your year end, use our R&D tax credit deadline tool to calculate your key dates in seconds.

If you miss the deadline, HMRC won’t accept the claim for that accounting period. In most cases, the deadline is two years from your period end, so a “late claim” usually means that year is no longer claimable (even if you can still claim for more recent periods that are within time). It’s also important to remember that required steps like the claim notification form and the Additional information form (AIF) have their own timing rules, and missing them can prevent a claim from being made even if you’re still within the two-year window.

A claim doesn’t automatically trigger an enquiry, but HMRC may review it or ask follow-up questions, especially if the numbers are large, the technical narrative is unclear, or the costs don’t tie out. The best way to reduce friction is a claim that’s well evidenced, consistent with the rules, and easy for HMRC to follow.

There isn’t a guaranteed timeline. Straightforward claims can move quickly, but processing can take longer if HMRC requests more information or if they’re dealing with higher volumes. The practical lever you control is quality: clear project explanations, clean cost schedules and the required forms submitted correctly.

Yes. We regularly work alongside your accountant and, where relevant, your auditor to make sure the claim fits your statutory accounts and Corporation Tax return, and that the technical narrative and cost treatment are aligned.

It depends on your wider tax position. In some cases, HMRC may offset amounts owed against what you’re due, or pause repayment while issues are resolved. The sensible approach is to flag any known liabilities upfront so we can factor that into expectations and avoid surprises.

Keep a clear audit trail that shows what advance you were trying to achieve, what uncertainties you needed to resolve, and the systematic work you carried out to resolve them, ideally captured as the project runs (plans, test results, iterations, decisions and failures). HMRC also expects the input of a competent professional to be evidenced, and your cost workings should tie back to payroll and accounts with sensible time apportionments.

Yes. HMRC’s guidance is explicit that the qualifying work does not need to be successful and you can claim for the qualifying costs of a completed but unsuccessful project, as long as it was a qualifying project at the time the costs were incurred.

Under the merged scheme, the R&D credit is a taxable expenditure credit that is first used to reduce Corporation Tax, and where there’s credit remaining it can be carried forward or potentially paid, subject to restrictions such as the PAYE/NIC cap and certain payment conditions. Loss-making, R&D-intensive SMEs may instead qualify for ERIS, including the option of a payable credit up to 14.5% of the surrenderable loss.

Sometimes, but it depends on the contract and who is treated as the party that decided to undertake or initiate the R&D. Where R&D is genuinely “contracted out”, the customer may be the claimant if it can show it intended that R&D of that sort would be done when the contract was entered into; the contractor’s position needs careful review because work done simply to fulfil a contract is often not the contractor’s qualifying R&D.

The most frequent issues are including work that isn’t qualifying R&D, claiming costs outside the eligible categories, misclassifying staff costs (for example, claiming non-employees as employees), and claiming non-qualifying overheads, as well as missing special rules (like connected-party treatment). Separately, claims can also run into problems if required steps like the Additional information form (AIF) are not completed correctly and on time.