HOW TO WRITE A TECHNICAL NARRATIVE?
The technical narrative should be written with input from those involved in the project and detail the specific nature of the advance and uncertainty, and how a competent, qualified person addressed this, demonstrating to HMRC the process undertaken and the technical hurdles required to achieve success.
The R&D technical narrative should provide a compelling demonstration of:
- the technological innovation(s) that your company has sought
- the current limitations
- the challenges you faced
- the resources used
- the outcomes achieved
HOW TO GET A QUICKER PAYOUT
There is no standard format for presentation, but reports will usually begin with a background of your company to explain the context of your R&D work.
In order to substantiate the claim, HMRC requires a short summary on a sample of projects that showcase the type of R&D your company is doing.
The ideal situation is to include detailed case studies of at least 1 to 3 projects. If your company has more than 4 projects, you must include detailed descriptions of at least 3 projects (up to a maximum of 10), which between them cover 50% or more of your total qualifying R&D costs.
PREPARE A ROBUST CLAIM
Start by making sure that the claim has been well prepared and the HMRC officer will easily be able to see that the company has undertaken qualifying R&D. The technological advances and uncertainties should be clearly and concisely described, and the relevant costs clearly analysed.
While you don’t want to leave any qualifying activity or eligible costs unclaimed, it’s equally important to ensure you don’t include items that simply won’t qualify.
INCLUDE BACS DETAILS
If the claim is for a payable tax credit, including the company’s banking BACS details with the claim will speed up the payment process once the claim is passed.
HMRC aims to pay 95% of SME credit claims within 28 days, although it is currently not achieving that target. Where the company has not included its BACS details, HMRC suggests that this delay can rise to 60 days.
FURTHER R&D TAX ADVICE
CONTACT US FOR FURTHER INFORMATION, OR TO REVIEW YOUR R&D CLAIM.
PARMINDER CHATTHA
Partner - Corporate and R&D Tax
Parminder specialises in Research & Development Tax Credits, leading the R&D department at Jeffreys Henry LLP. Since joining the Firm in 2015, he has been working closely with both SMEs and large businesses to analyse and maximise their Research and Development claims. He has so far secured over £70 million in R&D tax relief and credits for our clients.
KATE GREENHOUGH
R&D Director
Kate is a CTA qualified tax specialist with significant R&D tax experience. Kate has over 10 years of specialist experience in advising start-ups to PLC analyses, preparing and submitting robust R&D tax relief claims and Patent Box claims in line with the latest HMRC guidance. Her sector experience spans FMCG (fast-moving consumer goods), automotive, financial services, healthcare, manufacturing, construction, and food and drink.
