Preparing claims for the first time—what you’ll need

Author: Mike Dean Published: 1st June, 2023

In the last 12 months, HMRC have made changes to the R&D tax relief scheme in a bid to eradicate the malpractice that has developed within the R&D tax sector. While this extra scrutiny is welcome in a market that has, without any doubt, experienced problems due to a few bad apples, this shift in HMRC’s behaviour has caused some ripples to be felt across the R&D tax advisory sector. Some accountants are rightly seeing this as an opportunity to improve their operations, move their clients away from third party providers and implement a new R&D tax service offering under their own brand. They are realising that their clients are hungry for support, and there is a way to add more value to these client relationships.

Surely, this is what HRMC want to see as a result of legislation changes. A good accountant who understands the claimant’s business and who can steer them effectively through the eligibility criteria is precisely the kind of advisor who should be preparing claims in the eyes of HMRC. A deep, existing relationship is the very best way for an advisor to identify legitimate R&D work, which in turn helps remove the risk of SMEs being exposed to bad practice. 

So, what are the essential tools that you as an accountant will need to deliver a dependable R&D tax service in-house, and what role can R&D tax technology play?

Guiding the client

First of all, it is critical to ensure that both you and the client have a basic understanding of the R&D tax scheme. It is the client who should make the call as to whether science and technology is being advanced within a project, so preparing an R&D tax claim is something you need to do with your client, rather than for them. A key factor in the claims process, therefore, is ensuring your client has at least a passing understanding of the relevant parts of the guidance. But how?

To support the client through this process, you need to ask the right questions so that they understand what HMRC’s definition of R&D looks like and can assess if the eligibility criteria have been met. 

This is where R&D tax software with wrap-around support can be useful. WhisperClaims guides you through the conversation so that the right questions are asked. Questions flex around the data being input—none can be missed or skipped, ensuring all data is reliably gathered. 

If reassurance is needed, live chat and 1-1 support channels will give you quick and easy access to a team of R&D tax experts to lean on for scheme or eligibility advice. While built-in learning tools, explainer videos, and links to HMRC’s online guidance help to remove uncertainty as you and your client work through the claim.  

Simple processes

Having a simple, intuitive process that is applied in the same way every time, for every claim, is also an essential element to preparing robust and compliant claims. 

Fully automated R&D tax software provides structure, relieves friction and keeps you up to date with legislation. Qualification checks help identify potential issues early to quickly screen out ineligible work, while dynamic feedback guides you through the process. 

In addition, you have the option to invite your client to work collaboratively within the app, so that they can contribute directly to the process where appropriate.

HMRC friendly reports

Once a claim is prepared, an automated report is downloaded at the click of a button, reducing the time taken to prepare the technical narrative and costs breakdown for submission to HMRC. This saves hours, if not days, of report-writing.

When preparing supporting documents for an R&D tax claim, it pays to remember: ‘less is more’. All that’s really needed is to make sure that HMRC can see the claimant has considered all the relevant parts of the guidance and assessed the technical work and costs appropriately; padding the report with irrelevant details, commercial or otherwise, is simply counter-productive.

The value you as an accountant add, is in the robustness of the claim produced and the advice that they can give to your client—not the length of the technical narrative!

The value of WhisperClaims software and support

With WhisperClaims, you can gain access to intuitive software and expert support services to help guide you through the claims process. R&D tax specialists have their fingers on the pulse, feeding legislation changes back into the software. The software itself is constantly evolving to ensure that claims remain robust and compliant with current legislation—a great example being the introduction of the Additional Information Form, a new process for claim submission that will be compulsory from August 2023 for all claims.

WhisperClaims is already developing a solution to this that will ensure the submission process is as pain-free as possible.

A common challenge faced by accountants is identifying eligibility within their current client base. If advice is needed, a ‘Portfolio Review Service’ will help you uncover low-hanging fruit and potentially overlooked companies, while also flagging clients who are unlikely to be eligible. 

Once a claim has been prepared, built-in risk mitigation features will flag areas of weakness that should be reviewed, and an optional ‘Claim Review Service’ provides an additional layer of reassurance that the claim has been thoroughly reviewed by an R&D tax expert prior to submission.

All of this can be done without compromising on consistency or quality. Accountants can be sure that all claims are being prepared in the same way every time, and that their clients are receiving a robust and high-quality service.  

Critically, accountants can be confident that they are minimising the likelihood of prompting an HMRC investigation. Even in the event of one being launched, the structured and consistent process of WhisperClaims software ensures you can remain confident when responding to any additional questions HMRC may raise, with the added back-up of expert advice, guidance and support.

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