The claims process for R&D tax relief in the UK involves several steps to ensure compliance with HMRC requirements. As of July 2025, the process applies to the merged R&D scheme (effective for accounting periods starting on or after April 1, 2024) and the Enhanced R&D Intensive Scheme (ERIS) for qualifying SMEs, as well as the two legacy schemes.

Below is a typical, step-by-step claims process.

1 | Determine Eligibility

✔   Is my business eligible? You must be a UK company subject to Corporation Tax. Partnerships, sole traders, charities, and certain overseas entities are typically not eligible.

✔    Do I have qualifying R&D Activities? Projects must seek to advance science or technology (including pure mathematics since April 2023) by resolving scientific or technological uncertainties that a competent professional cannot readily address. Routine improvements or non-scientific work (e.g., arts, humanities) do not qualify.

✔    Assess Scheme Fit (for accounting periods starting on or after April 1, 2024):

  →   Merged Scheme: Applies to all companies for a 20% taxable credit on qualifying R&D expenditure.

  →   Enhanced R&D Intensive Scheme (ERIS): For loss-making SMEs (fewer than 500 employees, turnover under €100m, or balance sheet under €86m) with R&D expenditure ≥30% of total expenditure, offering a 186% super-deduction and 14.5% cash credit for losses.

2 | Pre-notify HMRC

As part of HMRC’s reforms to improve compliance and tackle abuse of the R&D tax relief system, pre-notification is now mandatory for certain companies. It’s a formal requirement to inform HMRC that a company intends to submit an R&D claim and must happen before the claim is submitted

Who needs to pre-notify?
Companies with accounting periods starting on or after 1 April 2023 must pre-notify if:

• they’re claiming R&D tax relief for the first time, or
• they haven’t made a claim in the past three accounting periods.

When is the deadline?

Pre-notification must be submitted within six months of the end of the accounting period being claimed. For companies with a 31 December 2024 year-end, this means the deadline is 30 June 2025.

What if I don’t pre-notify, or miss the deadline?
If your company is required to pre-notify and misses the deadline, you will not be able to make an R&D claim for that period.

3 | Identify Qualifying Costs

Eligible costs include:

     ✔    Staff salaries, employer’s NIC, pension contributions, and reimbursed expenses.

     ✔    Consumables (e.g., materials, heat, light, power used in R&D).

     ✔    Software, data, and cloud computing costs (eligible since April 2023).

     ✔    Clinical trial volunteer payments (pharmaceutical sector).

     ✔    Certain subcontractor costs (limited for overseas subcontractors unless R&D cannot be done in the UK).

     ✔    Capital expenditure, if classified as intangible assets.

You need to maintain detailed records (e.g., timesheets, invoices, project logs) to substantiate costs.

4 | Prepare a Technical Narrative

Document the R&D projects, detailing:

• The scientific or technological advance sought.
• The uncertainties encountered and how they were addressed.
• The methodology, experiments, or trials conducted.
• The competent professionals involved (e.g., engineers, scientists).

This narrative is critical to demonstrate compliance and withstand HMRC scrutiny, as one in five claims now face enquiries.

5 | Complete the Additional Information Form (AIF)

 
Since August 2023, submitting an AIF is mandatory for all R&D claims.
 
The form requires:

     ✔    Details of the R&D projects (up to 10 representative projects, covering 100% of the claim).

     ✔    Description of the scientific/technological uncertainties and advances.

     ✔    Breakdown of qualifying costs by project.

     ✔    Contact details of the lead R&D person and any agent assisting with the claim.

Submit the AIF to HMRC via the online portal before filing the Corporation Tax return.

6 | File the Corporation Tax Return

Include the R&D claim in the Company Tax Return (CT600), specifying:

• The enhanced expenditure (e.g., 186% for ERIS-eligible SMEs) or qualifying costs for the merged scheme.
• Any claim for a payable tax credit (for loss-making companies).
• For ERIS, indicate eligibility and R&D intensity (≥30% of total expenditure).

Claims can be made or amended within two years of the end of the accounting period (e.g., December 31, 2026, for a period ending December 31, 2024).

7 | Submit Supporting Documentation

Although not always submitted with the claim, prepare detailed records to support the AIF and tax return, including:

     ✔    Technical reports or project plans.
     ✔    Cost breakdowns (e.g., payroll records, material invoices).
     ✔    Evidence of uncertainties (e.g., test results, prototypes).

Retain records for at least six years, as HMRC may request them during an enquiry.

8 | HMRC Processing and Follow-Up

Processing Time: HMRC typically processes claims within 40 days, but first-time claims, complex cases, or those selected for enquiry may take longer (up to several months).

Enquiries: Due to increased scrutiny since 2023, HMRC may request additional information or challenge claims. Respond promptly with robust documentation to avoid delays or penalties.

Outcome:

• For profitable companies, the relief reduces Corporation Tax liability.
• For loss-making companies, a payable cash credit may be issued, subject to the PAYE/NIC cap (£20,000 + 300% of PAYE/NIC liabilities).

WE CAN HELP

If you have any questions relating to the claims process, or R&D tax relief in general, please get in touch with us, and a representative will get back to you to discuss your unique needs and explain how we can assist.