R&D tax repayment delays

We have seen significant delays in HMRC issuing repayments in recent months. As of 12 August 2019, HMRC were dealing with claims submitted on 9 May 2019 (for SME) and 22 December 2018 for Research and Development Expenditure Credit – far beyond their 28 days turnaround targets!

HMRC will not entertain a request for an update before a company’s submission date has passed their stated timescales. This leaves advisers quite powerless and clients in the dark, wondering when payment might be received.

Our tax governing body, the CIOT (Chartered Institute of Taxation), recently wrote to HMRC to raise concerns over the delays and to query what HMRC are doing about this problem, which is having a significant impact on clients and advisers.

HMRC have confirmed that the delays are due to staff losses combined with very high volumes of claims being submitted. They are however taking action, redeploying staff from other departments and recruiting new staff.

The CIOT is continuing to monitor the position and we hope to see an improvement in processing times as a result of increasing pressure being placed on HMRC in this respect.

If you have concerns, please do not hesitate to get in touch with a member of our tax team on 01903 234094.

A version of this blog originally appeared on the website of MHA member firm, Tait Walker.