Source · Select Committees · Public Accounts Committee
Recommendation 16
16
HMRC introduced new measures and significantly increased compliance checks to combat R&D tax relief abuse.
Conclusion
HMRC has introduced a number of changes in response to the high levels of abuse. Since August 2023 HMRC requires companies to make all claims digitally, with more detail and endorsed by a named senior officer.57 It told us it is no longer paying claims directly to tax agents, and it now requires companies to disclose the identity of agents involved in the claim. It said that these changes should help fewer genuine claimants be subjected to HMRC’s compliance approach. HMRC has increased the number of compliance checks for research and development tax relief claims, now checking over 20% of claims compared with around 1% previously.58 HMRC told us that its increased compliance work has raised an estimated £250 million in 2022–23, but it has not estimated the impact of the new policy measures it has introduced.59
Government Response
A response document is linked to this report, dated 3 May 2024. Response attribution to this conclusion has not been verified. Read the response document ↗