HMRC recently announced changes to the criteria for the research and development (R&D) tax credits scheme. The new rules have been designed to prevent fraudulent tax credit claims that ultimately prevent small and medium enterprises and start-ups accessing funding designed to encourage them to innovate.

The scheme has an important role to play in the UK’s recovery from the Covid-19 pandemic, but it can only do so if its resources are targeted at supporting and funding the SMEs that genuinely need it. As such, continuous refinement of the scheme is vital.

The changes discussed below are welcome, but we must also ensure those who need the funding do not fall through the cracks.