Paul Rosser explains the true cost of the R&D tax relief scandal and reveals who is to blame.
As I’ve written about previously, those behind disreputable R&D advisory firms are currently going to great lengths to avoid HMRC discovering that they are still helping companies with the submission of invalid and/or fraudulent R&D claims, as they desperately try to continue making money off the back of these questionable claims.
Whilst HMRC do appear to be taking steps to identify these advisors and then using the powers at their disposal to deal with them, these attempts at anonymity by some advisors are fairly new and are in reaction to HMRC’s increased compliance measures, mainly the introduction of the Additional Information Form (AIF) which became mandatory in August 2023.
The AIF requests the details of any advisor who assisted with the R&D claim. If details are included of an advisor that HMRC are already aware has a history of preparing invalid claims, then the chance of a compliance check is increased, so it makes sense that such advisors would want to keep their involvement a secret.
Things haven’t always been this way though, just a few years ago even the worst R&D advisors would proudly provide their clients, and HMRC, a report with their name splashed all over it. At this time, HMRC weren’t really doing much to check R&D claims, and even less to stop dishonest advisors who had made convincing company owners to submit invalid R&D claims, a very lucrative practice.
Download the full article below: