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R&D claim denied because computation was late

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This case highlights that to make a successful research and development tax relief claim, both a corporation tax return and computation need to be submitted to HMRC in time.

28th Feb 2024
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Sometimes a taxpayer does not have the right of appeal to a tribunal against HMRC’s decisions. Instead, they can seek a judicial review to take the dispute forward. This was the approach furniture wholesaler Bureau Workspace Limited took when its research and development (R&D) tax relief claim was rejected by HMRC because it was “late”.

What is a judicial review?

A judicial review can be used to move a dispute forward where there is no statutory right of appeal to a tribunal. Examples include where HMRC exercises discretion on whether a claim is late or the application of extra-statutory concessions.

Other R&D tax relief cases that might warrant judicial review could include the HMRC officer not having listened properly to representations explaining the R&D tax relief claim or where the claimant believes HMRC has acted in a way that appears to be unfair.

Christmas break

During 2021, Bureau Workspace identified an entitlement to a Research & Development Credit (RDEC) for the accounting periods ending 31 December 2019 and 31 December 2020. The only way to claim this tax relief within the statutory timeframe was by amending the corporation tax (CT) returns (FA 1998, schedule 18, para 83B & 83E [1]).

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Replies (2)

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By AndrewV12
29th Feb 2024 10:08

During 2021, Bureau Workspace identified an entitlement to a Research & Development Credit (RDEC) for the accounting periods ending 31 December 2019 and 31 December 2020.
Before the tax agent’s offices closed for Christmas on 23 December 2021, they attempted to file the amended CT return and computation for the accounts payable (AP) 31 Dec 2019.

They left it all a bit late in the day to file amended year ended 31/12/2019 accounts.

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By AndrewV12
29th Feb 2024 10:09

Don't forget to add to the above the G form now has to be filed but separately from accounts, comp and CT600.

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