HMRC needs to police R&D claims and providers
Jen Badger looks at a new research report on claimants’ experiences claiming R&D tax relief and the implications for HMRC.
Replies (8)
Please login or register to join the discussion.
"The only major difference was in how much of the work was done by the claimant company versus the specialist."
In my direct experience, there is little difference in how much work the claimant company has to do using either route ... a specialist typically provides a standard template (both of procedures and of forms), but all the basic grunt work (the descriptive prose through to the collection & collation of figures) is still done by the claimant company.
The only exception is where the specialist company is probably 'cutting corners' (by relying on a cut'n'paste approach with the least effort to shove the client's figures into 'their' version).
So, it's as well to realise that what you're buying if you appoint a specialist is at best a mentor/guide not a sub-contracted turn-key service ... which is no doubt why so many of them have onerous contracts that tie you into their fees for between 3-5 years (even if you choose to dispense with their services once you've got the hang of it).
We have one client that makes"R&D claims" without actually doing any R&D.
At the last meeting I had with them the partner told them "you do know you actually need to be doing R&D to make a claim, right?" The client response was well we're making the claim anyway, everyone else does...
I don't work on that client anymore........
What else do you expect when HMRC do practically b*gger-all to properly police dodgy R&D claims and everyone knows that, which only encourages this sort of fraudulent behavior.
Is it just me or is this article about a different topic than the headline?
I think we all agree there are many "specialists" in the business of making spurious claims on behalf of uneducated SMEs, which is what this headline appears to reference, however only the last sentence suggests anything about this.
"Claimants also wanted information on best practice to enable them to make better decisions about which providers to use, and to recognise rogue specialists more readily."
Like what? What is the issue currently and what can be done to improve it? This article is just saying some vague things about opinions on the current process and then saying "we wish it could perhaps be a bit different" with no suggestions or even quantifications of those wishes.
There's a good article could be written on the current issues around R&D claims, where HMRC get it right and where they get it wrong, the issues with "specialist" claim firms and how the process could be improved. None of that is in here though.
I mean it's probably not the author's fault their article isn't the article I thought it was, but if I click on a link saying "HMRC needs to police R&D claims and providers" I expect an article about the need for HMRC to police claims and providers and not a summary of claimants opinions on their own claims.
I don't know how many of my clients have been called out of the blue being sold the dream of free money because of the 'R&D' they've done. Thankfully my clients are well trained enough to call us first before doing anything tax related. Almost always the conversation ends in 'you can try if you like but you'll also need a new accounting firm, as I don't believe you qualify and any claim you make will be fraudulent'. Never had a client proceed with one of these.
"Never had a client proceed with one of these."
But of course, by definition, since you've already told them 'you can try if you like but you'll also need a new accounting firm' ... so any that tried are no longer clients of yours. :=)
We lost one client because we queried what R&D he was doing creating his website. Despite our remonstrations, the firm doing the claim seemed happy to submit it and take their cut. I wonder why /s They will probably disappear within a few years.
We recently took on another client with a huge claim last year that doesn't reflect the costs in the accounts and is touch and go whether it's R&D anyway.
I imagine there are millions of pounds worth of this sort of thing up and down the country.