Working with experienced and regulated agents as HMRC cracks down on non-compliant R&D tax relief claims
It is becoming ever more important to exercise caution when selecting an advisor to assist with Research and Development (R&D) tax relief claims.
The cautionary note comes as HM Revenue and Customs (HMRC) intensifies its efforts to clamp down on applications that do not adhere to compliance standards.
This crackdown underscores the importance of selecting reputable agents to navigate the complex landscape of valuable R&D tax relief.
The UK government introduced R&D tax relief to encourage innovation and technological advancement. However, as the popularity of this incentive has grown, so too have the number of providers and unfortunately also the risk of misuse and non-compliance.
Finding an experienced agent
RIBA's chosen partner, Beavis Morgan are a Financial Conduct Authority (FCA) regulated accounting practice with chartered tax professionals and a specialist R&D Department.
They understand the importance and benefits of a thorough and robust claim process. Beavis Morgan have a highly experienced team that undergoes continuous training to keep up with HMRC’s ever-evolving requirements.
R&D reports must meet all HMRC’s conditions for eligibility and clearly demonstrate the technical uncertainties and challenges. Unfortunately, many eligible companies are having their claims rejected due to advisors providing poor quality reports.
Architects should not be put off by HMRC’s compliance crackdown but rather review the quality and competence of their current process and ensure they engage a reliable agent, that is regulated to provide tax advice.
These experts play a pivotal role in helping businesses navigate the intricate requirements and documentation associated with the relief but are also able to stand by any claim submitted and respond to any claim enquiry by HMRC.
Naming R&D advisors on claims
HMRC's heightened scrutiny now requires the R&D advisor to be named on the R&D claim so architects must choose their representatives wisely. With an increase in compliance checks, Beavis Morgan are highly experienced in leading this process for a favourable outcome.
The consequences of non-compliance with R&D tax relief guidelines can be severe, ranging from financial penalties to reputational damage. Some recent cases for example, involve overinflated claims.
Architects should take several precautions when seeking professional assistance with their tax relief applications:
- Verify credentials: Before engaging any agent, it is essential to verify their credentials and experience in handling R&D tax relief cases. Check for qualifications, accreditations, and a track record of successful applications in the architecture and construction sectors
- Transparency: Ensure that the chosen agent operates with full transparency. They should clearly communicate their fees, processes, and timelines upfront. Avoid agents who promise guaranteed results or use aggressive sales tactics
- References: Request references from past clients to gauge the agent's reputation and effectiveness. Reliable agents will have a portfolio of satisfied customers who can vouch for their services
- Knowledge of industry specifics: Given the unique challenges and intricacies of architecture and construction, it is crucial to select an agent who understands the specific requirements of these sectors and can tailor the application accordingly
- Compliance expertise: A reputable agent will stay up to date with the latest changes in tax legislation and compliance standards. Ensure that your chosen agent has a deep understanding of HMRC's guidelines
- Documentation: Adequate record-keeping is essential for a successful R&D tax relief claim. Work closely with your agent to compile all necessary documentation, including project descriptions, cost breakdowns, and evidence of innovation
- Ongoing support: The relationship with your agent should extend beyond the initial application. They should be available to address any queries or concerns that may arise during the HMRC review process
By following these precautions and partnering with a trustworthy agent, architects and small and medium-sized enterprise (SME) building companies can minimise the risks associated with their R&D tax relief applications.
Our preferred specialist
Beavis Morgan R&D stands as a reputable and trusted partner for architects and the construction sector. As a specialised division of Beavis Morgan LLP, a well-established, FCA-regulated accounting, tax, and business advisory firm, Beavis Morgan R&D brings a wealth of expertise and experience to the table.
Their status as the preferred R&D specialist for RIBA Members underlines their deep understanding of the unique challenges faced by architects in the industry.
With a commitment to transparency, a track record of advising businesses in the sector and providing ongoing support, Beavis Morgan R&D offers a comprehensive solution for those legitimately seeking to leverage R&D tax relief to foster innovation and growth.
Businesses can rest assured that they have a trusted ally to help them navigate the intricacies of R&D tax relief and unlock its full potential for their business.
Find out more about Research and Development Tax Relief from the RIBA Business team.
