Why Handling R&D Tax Claims In-House Can Be Costly: The Case for Expert Support
For many innovative businesses, R&D tax relief is a valuable source of funding, and getting it right is paramount. Yet, many founders believe they can manage their claims in-house without external support. After all, they know their business better than anyone, so why bring in a provider?
The reality, however, is that R&D tax relief is more than just another admin task. It’s a complex process that requires deep knowledge of eligibility criteria, financial reporting, and ever-changing HMRC regulations. There’s no doubt business owners can attempt to apply HMRC’s guidelines to their projects and compile a claim. However, the risk of misinterpreting the legislation is real. This could result in a substantial amount of qualifying costs omitted or, worse, an HMRC enquiry that lasts for months.
The Hidden Pitfalls of Claiming R&D Tax Relief In-House
One of the biggest misconceptions amongst business owners is that R&D tax relief is another admin task. Yet, the process is not as straightforward as many believe. HMRC guidelines are extensive, and unique scenarios often arise depending on the business-specific circumstances.
We’ve seen countless examples of companies underclaiming their entitlement simply because they weren’t aware certain expenses could be included or because they misinterpreted the scheme. On the flip side, overestimating your expenditure or failing to apply the right framework to your claim can lead to compliance risks and unwanted scrutiny from HMRC.
Then there’s the challenge of accuracy. Business owners who manage their own claims often spend hours compiling reports, only to second-guess whether they’ve applied the guidelines correctly. Even those who successfully submit claims may be unaware of opportunities they’ve missed or risks they’ve unknowingly taken.
Adding to the complexity, recent reforms to R&D tax relief have introduced key administrative steps. While the process was historically less demanding, claimant companies must now navigate important submissions such as the Additional Information and Advanced Notification forms, as well as technical elements like R&D intensity, to name a few.
The Rising Risk of HMRC Enquiries
Inconsistencies in your claim, or with your Additional Information Form, can quickly escalate into an HMRC enquiry, which can be both disruptive and stressful. These investigations aren’t resolved overnight; they can stretch on for months, requiring extensive back-and-forth, additional documentation, and detailed explanations. For a business already juggling growth, fundraising, and product development, this kind of distraction can be costly.
Even companies that believe they have filed correctly can find themselves subject to scrutiny. HMRC’s increasing compliance checks mean more businesses are being asked to justify their claims in greater detail. By having a specialist on your side, you’re not left scrambling if HMRC comes knocking. A good R&D partner understands exactly what HMRC is looking for and can handle the process on your behalf, ensuring minimal disruption to your business.
A Shifting Landscape: Keeping Up with Compliance
R&D tax relief has been subject to significant reforms in recent years, making the claiming process more complex than ever. Increased compliance checks, stricter eligibility requirements, and evolving guidelines mean that what worked for a claim last year might not be enough today.
Trying to keep up with these changes while running a business is no easy task. A specialist ensures that your claim is not only accurate but also fully compliant with the latest regulations, reducing the risk of costly errors or delays.
Why You Already Work with Experts, And R&D Tax Relief Should Be No Different
You wouldn’t draft your own legal contracts without a lawyer. You wouldn’t file complex tax returns without an accountant. So why take risks with your R&D tax claim?
R&D tax relief is a specialist area. It requires a reliable partner, just like other areas where you already rely on experts.
Using a reputable provider isn’t just about convenience; it’s about making sure you get the most out of your claim while avoiding unnecessary risks. It’s about having peace of mind that if HMRC asks questions, you have the right people answering on your behalf.
When selecting a provider, conducting due diligence is essential to find a trusted partner who can handle your R&D tax relief claim.
Real Results from Expert Support
Still not convinced? Many businesses only realise the value of expert support after working with the right provider.
The benefit of a successful R&D tax claim can often lead to substantial funds that support increased investment in innovation. That’s exactly what happened for this start-up that partnered with Apogee for their rebate:
“They helped my start-up innovative company save a fortune by partially reclaiming R&D costs. This helped us in the last couple of years to reinvest in our innovative products and R&D.”
Ehan Sabet, CEO of Additive Manufacturing
For others, the real value lies in simplifying what can be a complex and time-consuming process:
“The team made light work of making a technical and sometimes seemingly complex and time-demanding exercise a walk in the park!”
Edward Grimshaw, Operation Director at Regal Blinds
And even for those who already outsource their R&D claims, switching to the right provider can unlock missed opportunities:
“The whole experience was far easier than we've experienced with other companies dealing with our R&D claim in the past. They started by looking at our claim for last year as we were disappointed that the previous company we were using told us, what we thought was a nailed-on R&D project, was not.”
Melanie Killen, Director at Recotherm
Most importantly, a reputable R&D provider can manage and resolve HMRC compliance checks, giving you peace of mind that your claim is in expert hands:
The team at Apogee have been amazing at not only successfully achieving a great R&D tax rebate for my company but they have also just supported me through an HMRC compliance check that I wouldn’t have had the first clue about where to start if it wasn’t for them!
Alison Skidmore, Founder of EaseTwist
The Bottom Line
If you’re an innovative business investing in R&D, claiming tax relief shouldn’t be a gamble. It should be a strategic move that ensures you recover what you’re entitled to while staying focused on what you do best: building and growing your business.
Interested in learning more? Schedule a free consultation with our experts to assess your eligibility.