You will have heard that soon, in some circumstances, HMRC will need advanced notice of your intention to claim R&D tax relief. We’ve been receiving a lot of queries from our partner accountants asking for clarification of this requirement. With a key deadline fast approaching we’re taking this opportunity to remind accountants of this key change to R&D tax relief rules.
Clarification of the advanced notification requirement from HMRC
In general it is correct that any company that has made a claim in any of the earlier 3x accounting periods does not need to submit an advanced notification form for their fourth accounting period in which they intend to make a claim. However, HMRC have drawn attention to the fact that it’s three years before the last day of the claim notification period (not from the end of the accounting period). Notification must have actually been made by that date (e.g. an intention to make a claim for an earlier period which will ‘frank’ that later period but is not made within the six months).
Additional layers of complexity, such as the inclusion of R&D claims through amended returns, may create issues around the timing of advanced notification but in the most straight forward of circumstances the below worked example would apply.
A worked example of the advanced notification requirement
First step – identify your claim notification window
Suppose a company has an accounting period that runs from 1 April 2025 to 31 March 2026. The company can notify HMRC of its intention to claim R&D tax relief for this accounting period during the claim notification window – this starts on the first day of the accounting period, 1 April 2025, and ends six months after the end of the accounting period, 30 September 2026.
Second step – check if the three year exemption applies:
The company does not have to submit a claim notification form for the current accounting period if the company made an R&D tax relief claim for an earlier period at any point during the three years that ends with the last date of the claim notification window i.e. at any point between 1 October 2023 – 30 September 2026. R&D claims made through an amended tax return may need additional consideration to ensure that the timing of the amendment doesn’t take you out of the three year window.
Third step – if the three year exemption does not apply check whether a relevant claim has been made after the last date of the claim notification window:
If the company made an R&D tax relief claim for an earlier period but they submitted that claim after the last date of the claim notification period for the current year of 30 September 2026 (i.e. after the normal claim deadline but before the CT return amendment deadline), then the company will have to submit a claim notification for the current accounting period to claim R&D tax relief.
Fourth step – check if the long period of account exemption applies:
The exception to the previous step would be where the earlier and current year accounting periods form one long period of account and a claim notification has been received which covers the whole period of account.
When does the Advanced Notification form become a requirement?
For accounting periods starting on or after 1 April 2023, the Advanced Notification form will become a statutory requirement for all first time claimants and any company that falls outside of the check process, above.
Is the Advanced Notification form different from the Additional Information form?
Yes – The Additional Information form became a statutory requirement for all R&D claims submitted to HMRC on or after 1 August 2023, regardless of how many previous claims the company has made or when those claims were made.
If I submit an Advanced Notification form will I still need to submit an Additional Information form?
Yes. If an Advanced Information form was required to be submitted during the notification window, when the actual claim is subsequently filed with HMRC the Additional Information form must also have been submitted on or before the filing of the tax return with the R&D claim. After 1 August 2023, if a claim is submitted without the Additional Information form HMRC will write to you to inform you that they have removed your claim for R&D relief from your tax return.
What to do if you aren’t sure if you are exempt from an advanced notification requirement
It remains complicated, however, if in doubt speak to an R&D tax specialist to make sure that your clients don’t miss out on this important tax relief due to an admin oversight.
All Source Advisors clients can be confident that this is in hand for them and we will raise any specific points during the normal claim process.
