Within the process of R&D compliance, there are a range of different ways HMRC investigates the tax claim submissions. Predominantly this is through enquiry letters, in which a compliance check is opened, however during this process there is a secondary check known as the Fraud Investigation Service (FIS). While an FIS is raised on a claim, everything is put on hold until this check is completed, which can delay a claim further or potentially result in the closure of a submission.
Some providers within the R&D world are noting a 400% rise in FIS checks, which while high, is not the first time we have seen HMRC increasing their investigation numbers. Hundreds of new employees have been brought in over the years for R&D compliance, and in previous years certain sectors had been brought into the spotlight through this process.
HMRC is doing its due diligence within the R&D world, to ensure the treasury is being allocated correctly, and as intimidating as this may sound at first, there is nothing to be afraid of as a company. Strong R&D claims will always have good supporting evidence behind them, and working with a trusted partner to help present this to HMRC will leave you in good stead within the investigation.
The most common results of these investigations are three potential outcomes;
- Your claim passes this check and continues to approval for the claim to be completed.
- Your claim is moved into a compliance review.
- Your claim gets rejected in its entirety.
Businesses need to ensure they are proactive in ensuring their claims are backed by solid and accessible evidence, which minimises the risk of any complication during the FIS check process.
Providing the best support your claim not only for compliance checks but also in the case of an FIS opening relied on the quality of your supporting evidence. Here at Kirby and Haslam, we are seasoned experts within R&D compliance, and working alongside us can help ensure your claim is robust and sustained by sufficient evidence.
If you have any further questions or concerns surrounding this process, or are currently facing an FIS check, contact us today on 0330 002 1362 or email us at email@example.com to discuss your claim.