R&D Tax Credit is changing in April 2023 – sign up to find out response to the Finance Bill 2022

The draft legislation for the Finance Bill 2022 was released last week containing details of the proposed changes to R&D Relief that were trialled during the Spring Statement. The key changes that will be effective for accounting periods starting on or after 1 April 2023 are:

• Costs for externally provided workers, subcontractors, and contributions to independent research (i.e. Universities) will only be eligible where the R&D activity has taken place in the UK. A limited number of exemptions have been included but are unlikely to have broad application.
• All new R&D claimants will need to provide HMRC with notification that they are making a claim within 6 months of the end of the accounting period.
• Companies will need to provide additional information when filing a claim including a breakdown of the qualifying expenditure and a brief description of the R&D.
• The inclusion of data licenses and cloud computing costs where they are attributable to direct R&D.

It is clear from the draft legislation that HMRC intend to tackle the issue of abusive claims and compliance. We await secondary legislation setting out the details of the additional information required; however, ease of implementation will be key so as not to deter genuine start-ups from claiming at a time when R&D credits can be vital to furthering genuine development.

To find out more about the changes to R&D Relief sign up for our webinar on 14th September at 11am.

Download R&D Tax Incentives fact sheet