Avoiding costly R&D tax claim mistakes

Mark Evans | R&D Tax Claims Ltd

As the Government clamps down on the £311m worth of fraudulent R&D claims made each year, how can manufacturing companies ensure they’re claiming what they’re entitled to without risking a HRMC enquiry months down the line?

Mark Evans – founder of R&D Tax Claims Ltd, which specialises in supporting manufacturing and engineering companies – says it’s all about getting the right advice:

“When an manufacturing company receives a cold call advising them they’re entitled to submit an R&D claim on a no-win, no-fee basis, it’s easy to take up that offer and assume there’s little or no risk associated.

But HMRC has ramped up the number of enquiries they’re opening. This can be done up to a year after paying out a claim, meaning companies have often re-invested the money they were paid out by the time they’re notified that there’s an investigation underway.

Next April, a number of changes are being introduced including the requirement to name any adviser who helped prepare the claim documents. This should lead to a reduction in the number of ‘cowboy firms’ as the submission of numerous fraudulent claims by the same people will be easier to identify. But how can manufacturing firms ensure they’re getting the right advice in the meantime?

Expertise and experience are crucial. What constitutes R&D within the manufacturing sector is very different from other industries, and that’s why any adviser needs to have specialist knowledge in order to properly advise on a claim. They should also have a history of successful claims, and testimonials from customers who they’ve previously assisted (preferably more than a year ago, so they’re past the HMRC enquiry deadline).

Many accountants will refer their clients into an R&D firm, so it’s worth asking to help ease your mind that you’re using a reputable firm.

And if you’ve already submitted a claim and are now worried that your adviser wasn’t the specialist they claimed to be? Then it’s worth putting aside the money you were paid until after the 12-month enquiry period has passed.

R&D Tax Claims has a free downloadable guide to choosing an adviser available at www.rdtaxclaims.co.uk.

Manufacturing Update