Overview

HMRC has launched an online R&D Disclosure Facility to help businesses and agents report errors in R&D Tax Relief claims. The form and guidance is available here: https://www.gov.uk/guidance/tell-hmrc-if-youve-claimed-too-much-research-and-development-rd-tax-relief

Who Can Use the R&D Disclosure Facility?

You can use this service if your company has:

• Claimed too much R&D tax relief.
• Cannot amend its tax return to correct an R&D claim because the deadline has passed.
• Needs to pay additional Corporation Tax or repay overclaimed R&D tax credits.

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Disclosures can be made by:

• Company directors or secretaries regarding the company’s tax affairs.
• Tax advisers acting on behalf of a company.

How the R&D Disclosure Facility Works

To make a disclosure:

• Submit the online form and upload calculations.
• Provide a letter of offer, with consent from a company director or authorised representative.

Types of Disclosures

Disclosures can be:

Unprompted: Voluntary and proactive, resulting in lower penalties.

• Careless errors: 0%-30% of the tax due.
• Deliberate(not concealed) errors: 20%-70% of the tax due.
• Deliberate and concealed errors: 30%-100% of the tax due.

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Prompted: Made after HMRC initiates contact, leading to higher penalties.

• Careless errors: 15%-30% of the tax due
• Deliberate(not concealed) errors: 35%-70% of the tax due
• Deliberate and concealed errors: 50%-100% of the tax due. 

Penalties can also depend on cooperation and a company’s compliance history.

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In Your disclosure Include accounting periods up to a maximum of either:

• 4 years from the end of the relevant tax period for errors made with reasonable care.
• 6 years from the end of the relevant tax period for careless errors.

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Final Notes

Seek professional advice to ensure calculations are accurate and avoid further disclosures. HMRC will review submissions and issue acceptance letters or request additional information if required.

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