HMRC have recently confirmed changes to R&D legislation, following on from consultation results released in December 2021 (https://www.richardsons-group.co.uk/rd-consultation-results/)

These will come into effect for accounting periods beginning on or after 1 April 2023.

The main focus of the changes is to tackle abuse of the R&D tax credits system and to refocus reliefs towards UK innovation.

To summarise the main changes from the announcement:

  1. Qualifying expenditure now includes the costs of datasets and cloud computing, the definitions are as below:
    • A data licence is a licence to access and use a collection of digital data
    • Cloud computing services include the provision of, access to, or maintenance of, remote data storage, operating systems, software platforms or hardware facilities.
  2.  Only subcontracted work and external workers provided by companies/businesses in the UK will be available to be included in an R&D claim.
    • There will be some limited exemptions based on factors such as geography, environment, population, or other conditions that are not present in the UK that are required for research.
    • There will also be exemptions where there are regulatory or other legal requirements for certain activities to take place in specific territories, for example clinical trials.
    • Cost or time will not be an exemption for not using UK subcontractors.
  3. Further details will be required alongside all submissions. At Richardsons we produce an R&D report which covers the information highlighted by HMRC, as well as being able to give advice to ensure that claims made meet the requirements set out by HMRC.
  4. New claimants will need to inform HMRC that they plan to make a claim in advance. This will be done using a digital service, and will need to be submitted within 6 months of the end of the period to which the claim relates to. If a company has not made a claim in any of the 3 periods beforehand, they will also have to pre-notify.

Further information from HMRC can be found at https://www.gov.uk/government/publications/research-and-development-tax-relief-changes/research-and-development-tax-relief-reform

If you have any queries on any of the points raised above, please get in touch with your usual contact at Richardsons or speak to a member of our R&D team.

John Holland, Laura Hankey and James Chapman.

Venturefest 2018

Venturefest 2018

Venturefest20 – Back to the Future Venturefest is an annual event and one of the leading showcases for innovation in Oxfordshire, where entrepreneurs, innovators and investors can meet, network and learn. The 20th Venturefest Oxford will take place in a brand new...

Sporting Corporate Challenge 2018

Sporting Corporate Challenge 2018

Jack, Jemima, Kate, Jamie & Tom outside our building in Thame. Since April 2018, Richard Venables (a director of our client Experience Oxfordshire) has been High Sheriff of Oxfordshire. His focus for the year is on youth participation in sporting and cultural...

Artificial Diamonds

It is to my great fortune that Richardsons’ intimate involvement with the Oxfordshire technology innovation community requires me to visit the Harwell Campus on a regular basis. Driving on to the site, on the right-hand side I see an impressive new building with the...

Economic Outlook 2018 and Beyond

On Thursday 19th April 2018, in bright sunshine, the clients and guests of Richardsons and NatWest Bank gathered at The Oxfordshire Golf Club, to hear the views of RBS Senior Economist, Stephen Blackman, on this vital and engaging topic.  It seemed that the sunshine...

Chilterns 3 Peaks Challenge

Richardsons are delighted to support Rennie Grove Hospice Care which is a fantastic charity that provides care services for patients with life-limiting illness. This Sunday a team from Richardsons will be taking part in the Chilterns 3 Peaks Challenge 2017. The...

Are Richardsons clients better protected from fraud?

Are Richardsons clients better protected from fraud? As identity fraud hits record levels, surveys show that individuals are not doing enough to protect themselves and company directors are more exposed to the risks! It is said that company directors can be twice as...

Beware the LLP!

The LLP (Limited Liability Partnership) has been around for a good number of years now, and is a very popular business vehicle for professional practices such as solicitors and architects, as well as for certain investment and property businesses.  There are, however,...