Science and technology in R&D tax relief

What should an R&D technical narrative include?

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The aim of a technical narrative should be to convince HMRC that the claim is valid and answer any questions they might have about the claim, without raising any red flags

The narrative should briefly cover the key points that HMRC are interested in:

  • Which areas of science or technology was the company operating in?
  • What technical advances did the company seek to make during the claim period?
  • What technical difficulties did it meet along the way?
  • Did the company use competent professionals to carry out the work?

Once you’ve covered these four points, you’re most of the way there!

Best practice

Stick to the technical facts! HMRC don’t really care about the commercial aspects of the projects, so stick to talking about the underlying technology.

Keep it short! The best technical narratives tell HMRC exactly what they need to know and no more. The longer the report, the information HMRC have to ask questions about, and the more likely you’ll include irrelevant or commercial facts and figures.

Link to the costs. It’s always best to include some mention of how your technical narrative links to the costs included in your CT600 so that HMRC can see how the two hang together.

Leave no stone unturned… Having said that it’s best to keep the technical narrative short, we’d recommend including short, factual statements to demonstrate to HMRC that the claim has been thoroughly analysed and well put together. For example, even if a company didn’t receive any grants during the claim period, it’s still good practice to state that this is the case, indicating to HMRC that you understand the guidance and what is required.

What not to do

Include lots of padding. HMRC aren’t concerned about the qualifications of the person pulling the claim together, or reading long descriptions of the history and financial successes of the claimant company. In fact, including too much irrelevant information could make it look like you’re trying to hide something!

Focus on the commercials. As stated above, the technical narrative should be a technical narrative. Don’t include any information about the commercial aspects of the claimant company’s business unless it is directly relevant to the claim. Including too much of this kind of information can confuse the narrative and could lead HMRC to conclude that ineligible commercial costs have been included in the claim.

Blind the reader with science. Remember that you’re writing your report for an HMRC inspector who is unlikely to be an expert in the relevant field of science or technology. Make sure that the report is written in clear, easy to understand language, and avoid using too many technical terms or jargon. This way, the inspector can understand exactly why the claim is eligible without having to ask for expert help.

How does WhisperClaims help with technical narrative?

When we designed the WhisperClaims app, we started by thinking about the ideal technical narrative. We thought about what questions it would need to answer, and what it would need to cover, and then we sat down and wrote it. It wasn’t until we’d perfected the report that we started building the app!

These days, every report produced by the WhisperClaims app is a descendant of that first, ideal report. Using WhisperClaims to produce your technical narratives makes sure that all reports are robust and consistent, and directly linked to the costs that you have entered.

How to write an R&D tax relief technical narrative

With HMRC’s new mandatory requirement for project descriptions on all submissions, we wanted to share our experiences to help others to write their best possible technical narratives.

Available to download here.

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