R&D Claims likely to be delayed…

HMRC is warning businesses to submit research and development (R&D) claims as soon as possible to avoid a likely delay in payments between December and January.

As the filing deadline for the most popular year ends is 31st December, there is always a flurry of R&D submissions in this period, which can cause delays in payments.

Between December 2021 and January 2022, HMRC expects to be dealing with higher volumes of R&D claims. Whilst HMRC said it was committed to processing 95% of R&D tax credit claims submitted online within 28 days of receipt, they admit it could take longer during the peak period.

The 28-day processing aim does not apply to:

• claims not filed by the electronic portal.
• claims where BACS details have been omitted or incorrectly supplied.

Businesses are also advised not to chase the progress of claims due to pressure on HMRC services. Instead, to get an update on the status of any R&D claim, taxpayers should check the company’s online account to determine whether the claim has been processed. Payments processed will be visible on the company’s online account within 24 hours, however they may be subject to a further security check before they are issued.

HMRC have also asked that taxpayers also allow 28 days before calling the corporation tax helpline to chase up outstanding payments.

This seasonal increase in claims is likely to be a worsening situation, as the level of R&D claims increases.

In 2020, total UK business employment in R&D grew by 18,000 to 283,000 full-time equivalent positions, an increase of 6.8% since 2019.

Expenditure on R&D by UK businesses grew by £900m to £26.9bn in 2020 despite the pandemic; the increase of 3.5% was similar to recent year-on-year growth, Office for National Statistics figures show.

If you’d like to know more about R&D claims, you can find more detail here.

To discuss your R&D claim, or even the possibility of making one, please get in touch. We can handle the process on your behalf, and have solid experience in doing so successfully for many of our clients.