An R&D claim is made of two connected parts: the technical description of qualifying project activities and the associated financial breakdown of eligible costs. Within the financial section of your R&D claim, you arrive at a final figure that must be entered into a document called the CT600. This form, together with your Corporation Tax computations, makes up your Tax Return.

When sending your claim to HMRC, you have two options:

1. Incorporating the R&D claim with your original CT return
Following normal accounting practices, you can include the R&D figure in your CT600 and Corporation Tax computations from the outset.

2. Submitting your R&D claim as an amendment
If you have already filed your accounts and tax return, you can add your R&D figure by amending the CT600 and computations. You have up to two years from the end of the relevant accounting period to do this.

Over the years it has been more common that businesses submit an R&D claim via an amendment, as it can take many months to get all the necessary information – and people – together to complete the documents, and there is a 2-year window in which to do it.

However, as a result of the changes to the submission process, including the requirement to notify your intention to claim, as well as HMRC’s increased enquiry rate, we believe that planning to submit the R&D claim with the original CT return makes a lot of sense.

Why Do We Recommend Including R&D from the Outset?

Demonstrating Genuine, Planned R&D

HMRC has significantly increased scrutiny of R&D Tax Credit claims in recent years. They’ve raised the number of compliance checks and introduced new claim procedures such as Claim Notification and Advance Information Form (AIF) submission, sending a strong message that HMRC now wants to see clear evidence of planned R&D activity. Filing R&D claims at a later stage (even for entirely legitimate reasons) could potentially trigger HMRC to question whether the costs were fully planned from the beginning or were subsequently thought of as a way to boost tax relief.

More Accurate Technical Reporting

Accurately describing your R&D requires fresh memories and clear details. From a technical perspective, it’s easier to capture accurate details of the project if you put your claim together sooner rather than later. When the technical narrative is still fresh in the minds of those involved, and all relevant project documentation is in place and up to date, it’s simpler to provide a precise account of what was done, why it was challenging, and how it advanced knowledge in the field. Waiting months or years later to compile the R&D claim can lead to omissions or inaccuracies, which in turn can trigger questions from HMRC.

Our Best Practice Recommendations

1. Plan & record every step – Capture and document R&D activities and costs as you go, ensuring strong evidence of a planned process.

2. Include R&D in Your Original Tax Return – It helps demonstrate genuine, planned R&D projects and allows the company to have a clear tax strategy in place.

3. Keep Records Accurate – Ensure all technical and financial data is recorded promptly and thoroughly. Keep clear documentation of your project objectives, challenges, and breakthroughs to make any potential compliance checks smoother.

Understanding what HMRC is looking for is at the heart of making an R&D tax claim robust, and compliant. The more you show that your R&D is genuine, planned, well-documented, and integral to your business—the more likely you are to meet HMRC’s criteria.

If you have any further questions about R&D tax claim submission or R&D tax relief in general, please get in touch with ABGi. A representative will get back to you to discuss your unique needs and explain how we can assist.