Regulating advisers will reduce R&D tax relief abuse

As HMRC concludes consultation on the abuse of research & development tax relief at the end of August, ABGI-UK’s Scott Henderson calls for the regulation of advisers at a time when the UK needs to be globally competitive

Research & Development (R&D) tax relief has been a positive force for economic growth and employment by stimulating UK companies to invest in innovation. However, it has also been open to abuse, with HMRC suggesting it has identified and prevented over £300m fraudulent claim attempts through the SME R&D tax relief scheme alone.

This led HMRC to launch its consultation, ‘Preventing abuse of the R&D tax relief for SMEs’, in March, which has been extended until the end of August due to the Covid-19 lockdown.

Meanwhile, a further HMRC consultation, also closing at the end of August, is focused on raising standards in the tax advice market. The call for evidence is requesting views on a number of issues including the ‘characteristics of good and bad practice.’

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