HMRC cracking down on R&D claims
Companies that undertake research and development (R&D) should be aware that more information will be required when claiming the associated tax relief from 1 August 2023. What’s changing?
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Accounting for VAT if there is no cash payment
Your business has submitted repayment returns for the last two quarters and you are concerned that you might have underpaid output tax on some supplies where no money has changed hands. Are your concerns justified?
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Treatment of distributions under review
The government has launched a consultation on modernising the tax treatment of distributions and repayments of capital by companies. The proposals could affect the distinction between dividends taxed as income and capital payments subject to CGT. What changes are being considered?
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Tax relief on equipment you haven’t paid for (yet)
The timing of tax relief for purchases of equipment isn’t straightforward when payments are delayed or goods are purchased through hire purchase (HP) agreements. How can you use these rules to your advantage and get tax relief before you’ve paid the final invoice?
Due to increasing concerns over the abuse of the R&D scheme, HMRC has issued guidance on the new process for claims made from 1 August 2023. An additional form will need to be completed and, if this is not submitted to HMRC prior to the corporation tax return for the year, HMRC will amend the tax return to remove the R&D tax relief. Contact details for any agent involved in the claim along with a director/employee responsible for the claim will need to be provided. Further information about the R&D project itself will need to be detailed on the form, however, where a company has more than three R&D projects, this will only be necessary for 50% of the expenditure.
The guidance goes on to describe the depth of the information required; such as the advance in a specified scientific or technological knowledge the company aimed to achieve, the uncertainties the company faced and how the uncertainties were overcome.
You can find the guidance here.
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