How far back can you claim R&D tax credits?

Oct 25, 2022 | Business planning

It’s a question we get asked all the time, and it can be confusing if you’re unsure of what you need to do to qualify for R&D.

Just how far back can you claim?

In this blog, we’ll clearly indicate what you need to do to adhere to R&D, how far into the past you can claim, and hopefully, get you some funds for your business.


When can I claim?

You may claim for a tax return period that has already been submitted to HMRC if your company has been engaging in qualifying R&D but has not yet requested R&D relief. Two years following the end of the accounting period is the deadline for this.

Remember the tax return due date may not coincide with the accounting quarter.

The latest you can make changes to your Corporation Tax return is normally 24 months following the end of the accounting period. R&D tax credits are a type of Corporation Tax relief.


New to claiming R&D tax credits?

Accounting periods for well-established organisations are typically 12months, though there may be unique situations when they’re different.

As an example the 12-month deadline could look like this:

  • You file your accounts by 31 March each year
  • You have until 31 March 2023 to make a claim for your accounting period ending 31 March 2021.
  • The actual deadline is midnight on 31 March 2023.

After that, it won’t be possible to claim tax relief on R&D-qualifying expenditure incurred between 1 April 2020 and 31 March 2021.

Both the SME R&D tax relief scheme and The Research and Development Expenditure Credit (RDEC) scheme offer Corporation Tax relief, so the 24-month deadline applies to both.


How can I claim R&D tax relief as a start-up?

During the first year of operation, things can be a little different. Your incorporation date is specified by the date you register your firm with Companies House.

This date becomes the default registration date, so your first accounting period is set to twelve months from the end of that month.

Moving your accounting year to another date is fairly commonif this date doesn’t work for you. As a result, your first financial period may last anywhere between 6 and 18 months.

No matter how long each accounting period is, the R&D tax credit filing date is always two years from the end of each accounting period.

This applies regardless of the reason for your accounting period’s variation, not just if your company is new.


What if the start date of the project begins before we can claim?

An R&D project that began before the two-year limit but is still in progress may be eligible for reimbursement.

You may still claim if you can prove that you spent money on qualified R&D activities during your most recent two accounting periods, regardless of when the specific project was initiated.


Let’s talk about R&D

Getting the funding you need for your project isn’t easy – especially when you’re thinking about the legwork you need to do to get it.

By talking to an accountant, you’ll be outsourcing a lot of this hard work, and giving yourself back time to focus on your business.

Talk to us to discuss your R&D claim.

Ready to go? We’re excited to hear from you.

Let’s get started, as soon as you’re ready. We’re always up for a chat about how we can support you and your business.

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