What Is The R&D Pre-Notification Form?

HMRC now requires claimants to submit a formal pre-notification form prior to submitting any R&D claim via a corporation tax return. This is something completely new to the UK scheme and many businesses are unaware that this is now required from 31 March 2024. If you fail to submit this form within the allotted time window, then any claim for that accounting period will be automatically withdrawn by HMRC and any cash benefit will be lost.

Key dates and requirements

Innovative companies that are looking to make an R&D claim for an accounting period beginning on or after 1 April 2023 will need to complete a mandatory claim notification form.

There are exemptions for regular claimants, and you will only need to complete and submit a claim notification form if you meet the following criteria:

• If you're claiming R&D for the first time; or
• You haven't made an R&D claim within three years.

The claim notification form needs to be submitted within six months after the end of the accounting period in question. For example, if your accounting period is between the 1 January 2024 – 31 December 2024, then you must submit the claim notification form between the 1 January 2024 - 30 June 2025. This is a hard deadline with very limited room for appeal if a company fails to submit the form.

Remember: Failure to submit a completed notification form will lead to the automatic removal of any claim and no right to appeal irrespective of how innovative the work has been.

Required information for claim notification form submission

To complete and submit the claim notification form, you will need the following details:

1. The company's Unique Taxpayer Reference (UTR).
   1. The same UTR will be required for Additional Information form (AIF) and company tax return.
2. The main senior internal R&D contact in the company who is responsible for the R&D claim.
   1. This is typically a director that oversees the financial or technical aspects of R&D.
3. The contact details of any agent involved in the R&D claim.
   1. This includes any agent who has aided or provided advice in relation to any part of the R&D claim.
4. The start and end date start of the period of account in question.
5. The start and end date/s for the accounting period/s for which you're claiming the tax relief or expenditure credit.
6. A summary of the high-level planned activities. This requires an outline of how your projects meet HMRC's definition of R&D.

An extended accounting period

If you have a long period of account that covers over 12 months, then HMRC will see this as two tax accounting periods. For example, if the period of account for which you're claiming R&D costs is between 1 January 2024 – 31 March 2025.

The window to submit the claim notification is between the start of the period of account and six months after the end of the entire accounting period even though for tax purposes the claim will be split between two tax submissions. In this case, the window is between 1 January 2024 – 30 September 2025. One pre-notification form covers the entirety of this long accounting period.

The current versions of the Claim notification form request that you only tell them about the first accounting period which can appear confusing. Therefore, we would advice that companies consult with an R&D specialist when submitting their first pre-notification to ensure everything runs smoothly.

What are the risks?

This is a short deadline in which the notification needs to be made, particularly as previously companies could make an R&D claim up to two years following their year end. Therefore, if a company carries out development work and only starts thinking about claiming this as the tax return is being prepared, which is often nine months after the year end, it's already too late. Therefore, companies need to be assessing their potential to claim much earlier and checking this against the pre-notification requirements. Indeed, we would recommend that companies should move to a real-time claim review process to try and avoid any mistakes.

Due to the novelty of these forms and requirements, in addition to the lack of clarity in the guidance, it's essential that companies are well prepared to submit their R&D claims. To prepare yourself and streamline this process, we recommend contacting a regulated R&D adviser, such as Buzzacott, to mitigate any issues that may arise.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.