HMRC has been accused denying genuine claims for tax breaks on research and development (R&D) from small firms. A number of business say the tax office is rejecting valid submissions, delaying payments and grabbing back tax credits as it ramps up efforts to tackle fraud. HMRC estimates that £7.6bn in R&D tax relief was claimed by more than 90,000 firms in 2021/22. However, it believes more than £1bn of this was paid out due to fraud or in error. As it looks to clamp down on this, the tax office is taking a tougher approach to claims, with officials now checking one in five applications compared to one in a 100 previously. Amid concern that this approach could see more genuine claims being rejected, Natasha Frangos of Haysmacintyre said: “There is a real risk that the handling of some R&D tax relief claims is undermining the Government's own policy to support investment here in the UK.”
