26 January 2026
4 min read
A recent tribunal decision clarifies why some innovative projects don’t qualify for R&D tax relief. Read what the ruling means and how to frame R&D activity correctly.
A recent First-tier Tribunal decision involving M&C Educational Training Services Ltd provides a useful reminder of where the boundary sits between genuine qualifying R&D and innovation that, while valuable, falls outside the scope of the R&D tax relief regime.
In short, the claim was rejected because the Tribunal found that although the project aimed to disseminate existing scientific knowledge in a technology-driven way, it did not seek to advance scientific or technological knowledge or capability in the underlying field itself. As a result, it did not meet the requirements of R&D for tax purposes.
Let’s break this down into the practical learning points that matter for businesses planning or reviewing an R&D claim.
At the heart of the case was a fundamental requirement for R&D tax relief: whether the company was seeking an advance in a recognised field of science or technology.
The business developed an e-learning platform (built using an existing open-source platform) to deliver education and training in metallurgy. The R&D claim focused on creating new teaching materials and methodologies, and delivering education in a novel way.
The Tribunal accepted that the work involved effort, originality, and a technology-enabled approach. However, it concluded that the project was not seeking a qualifying scientific or technological advance.
In simple terms, the project, with metallurgy as a subject, was about:
→ improving how training and education were delivered, and
→ disseminating existing scientific knowledge
But it was NOT aimed at advancing scientific or technological knowledge or capability in the field of metallurgy itself, which is a core requirement for R&D tax relief.
That distinction matters because the guidelines explicitly exclude work in the arts, humanities and social sciences (including education) from being treated as “science” for R&D tax purposes.
This decision reinforces a long-standing point that trips up many otherwise well-intentioned claims: the advance has to be in science or technology, not in how the outcome is taught, packaged, or applied.
The Tribunal put this very clearly, stating that:
“Increasing and/or improving the workforce by using innovative ways of educating and training them with existing publicly available knowledge and existing capabilities in the field of metallurgy does not mean that the appellant itself has made an advancement in the relevant field of science itself within the meaning of the Guidelines.”
That’s why claims can fail even where a business has:
They fail because the “newness” sits in:
…rather than an advance in a field of science or technology.
For R&D tax relief, the core questions remain consistent:
✔ Was there scientific or technological uncertainty that couldn’t be readily resolved by a competent professional?
✔ Was the work aimed at achieving a non-trivial advance in a recognised field of science or technology (not just something new to the business)?
✔ Was there evidence of a structured attempt to resolve that uncertainty?
Tribunal decisions like this can sound discouraging to businesses that are claiming, or thinking about claiming, R&D tax relief. In practice, we find they are often genuinely helpful.
They provide clarity on:
→ what R&D tax relief is designed to support
→ where the boundary sits
→ and how to frame projects in a way that aligns with the rules
For companies carrying out genuine scientific or technological development, the message is simple: get the advance and the uncertainty clear early, and the rest of the claim becomes much easier to support.
This case also serves as a useful reminder of the importance of seeking advice from a competent adviser when preparing R&D tax relief claims, particularly where projects sit close to the boundary between technical development and wider innovation.
If you have any questions relating to R&D tax relief or Enquiry Defence, please contact the ABGi Team. A representative will get back to you to discuss your unique needs and explain how we can assist.