Enquiry defence
Avoid and defend against a lengthy and costly HMRC enquiry
Your claim defence is our responsibility
ABGI has a standalone Enquiry Defence team which can help companies who’ve prepared and submitted claims themselves or using a different provider. We will take over responsibility for defending the claim, advising on the best defence strategy and negotiating with relevant tax authorities until an agreement is reached.
HMRC enquiry rates are rising and, if not handled properly, could damage your business. Questions can be detailed, requests can be onerous and the potentially lengthy process could be costly to you and your business in a number of areas.
Regardless of how a claim has been submitted – by an internal team, accountants or other adviser – there is always the risk of an HMRC enquiry. Enquiry rates are rising and, if not handled properly, could damage your business. At best, an enquiry will take up valuable time which could otherwise be focussed on growing your business.
The guidelines are lengthy and detailed and - despite hearsay that HMRC doesn't have the resources to look at every claim - they are very focused on making sure tax relief only goes to those with eligibility.
Enquiry defence from ABGI UK
ABGI has successfully defended tax authority investigations globally for many years
We work with your technical/financial teams
to fully resolve any question that HMRC may have concerning your R&D tax relief claim;
Written responses and additional technical narrative for HMRC
to address queries and
support your claim, if required.
Amend supporting cost documentation
as a result of our investigation and resubmit these to HMRC, if appropriate.
Full guidance, support and preparation for HMRC calls and site visits
and be on hand to mediate and provide guidance to ensure that your claim is presented robustly.
Prepare amended tax computations
as a result of the enquiry by engaging with your accountant, if necessary.
HMRC enquiry timescales and limits
HMRC enquiries can involve detailed questions and requests for documentation. It could have consequences for your claim (and potentially past and even future claims) and impact on the running your business, consuming valuable resources. They can also take a very long time to resolve particularly if there is a difference of opinion.
Claim retractions
The most common problem we see from clients who have used other providers or self-claimed, is where HMRC have asked for a full retraction of the claim.
It's not just about the claim being rejected; it can also be about the annual relief in the future that will be almost impossible to justify if you cannot win an argument with HMRC on retraction of a claim.
We have found that 9–12 months of protracted detailed questioning is normal. What impact would that have on your business?
Documentation requests
HMRC Tax Inspectors can and do ask for documentation: emails, spreadsheets, invoices, contracts, and other written correspondence.
How good is your administration? Can you provide an audit trail to defend your position? If you used a third-party, will they provide you with adequate support and documentation?
HMRC have a clear mandate to protect tax receipts and robustly validate claims. They also have the patience and resources to do this thoroughly. Having an experienced, expert advisor by your side to support you through the process will reduce the impact on your time, provides reassurance and give you the best chance of a successful defence.
If agreement cannot be reached through a compliance check, document requests can become more onerous before eventually going to a tribunal. Requests can ask for all project documents, including all plans, meeting notes/minutes and e-mails between staff discussing the R&D.
Furthermore, all correspondence and e-mails between the company and any third party discussing any aspect of the R&D, including all suppliers, to include internal and external e-mails, memos, file notes in any form (paper and electronic) could be requested.
We contacted ABGI to help us address the various questions HMRC was asking about a claim we’d submitted ourselves. ABGI helped rescue us from a bad situation, it was money well spent! I would recommend ABGI to other companies - they will support and help them navigate the difficulties of R&D tax relief claims, and of course ensure a successful, compliant submission.
Mike Allan
Director of Operations, LendingCrowd
HMRC enquiry timescales and limits
HMRC told us of a compliance check that led to an investigation for tax fraud on the basis of an R&D tax credit claim for £850k that took 2.5 years to complete.
HMRC can review records from up to 20 years previous
A misconception exists about time limits applying to HMRC assessments, with many people citing a two year limit. This is simply not true.
Although you can amend your tax returns up to two years back, HMRC can review your company's records six years from the end of the relevant tax period if they find that your or your agent has been careless.
However, they can extend this to up to 20 years if they believe you or your agent's actions have been deliberate e.g. describing transactions inaccurately or in a way likely to mislead.
For the purposes of assessing that loss of tax, the person will be treated as having deliberately brought about the loss of tax which resulted from the inaccuracy whether or not it was their intention.
Have a question?
Contact ABGI and a representative will get back to you to discuss your unique needs and explain how we can assist. Submit an enquiry or call us on
0203 984 0321
