For accounting periods starting on or after 1st April 2023, a company may need to pre notify HMRC of their intention to make an R&D claim if:

• It is making a claim for the first time, or
• Its last claim was made more than 3 years before the last date of the claim notification period. (The last date of the claim notification period is 6 months after the end of the period of account).

Even if the company has made a claim within 3 years of the last date of the claim notification period, it may still need to pre notify if one of the exceptions apply:

• HMRC rejected your claim by removing it from the Company Tax Return,
• An R&D claim was made for an accounting period beginning before 1st April 2023 in an amended tax return which was received on or after 1st April 2023.

The pre notification rules in the first two bullet points above are clear cut and, with careful management of deadlines, they should not create a problem. In fact, even if the pre notification rules apply, a pre notification form may not be required if the claim itself can be submitted before the last date of the pre notification period. This is something that we encourage our clients to do rather than duplicating work.

It is the second two bullet points, within exceptions, where we have recently seen two of our clients come unstuck. In both cases these were clients who were transferring their R&D work to us because they were unhappy with the service provided by their current advisers (for good reason as it turns out!)

Case 1: R&D claim rejected – future claim lost

Company A submitted their R&D claim for y/e 31 March 2023 on time. But by September, they heard from HMRC’s Fraud Investigation Service.

The previous adviser replied to HMRC’s queries – but offered nothing new. As a result, the claim was rejected, and HMRC issued a correction notice. At this point, the client came to us for help.

We could see there was merit in the claim. But the value was low, and the cost to pursue outweighed the benefit. So the claim was dropped.

Here’s the kicker: because HMRC had removed the 2023 claim, and the client hadn’t pre-notified for 2024 (they’d assumed the 3-year rule applied), they were now unable to claim for 2024 either.

Even if we had amended the return to reinsert the claim, it would have been classed as an amended return made after 1 April 2023. And that, under the new rules, still triggers the need to pre-notify.

We confirmed our interpretation with HMRC’s Technical team. There’s no discretion here. No appeal. No flexibility.

It would therefore seem prudent in situations where HMRC raises an enquiry in respect of a Company’s first R&D claim, or where it has not made one recently, that a pre notification is made in respect of the subsequent year before the expiry of the deadline.

Case 2: Missed deadlines and a narrow escape

Company B was a long-standing client of ours, but they’d appointed a low-cost R&D adviser to handle their claim for y/e 31 March 2023.

Come March 2025 – just days before the deadline to amend the return – they came back to us. The other adviser had failed to prepare the claim.

We flagged the risk immediately: without a valid 2023 claim submitted before 30 September 2024, a 2024 claim wouldn’t be allowed unless pre-notification had been made.

Company B hadn’t notified HMRC. So they needed to rely on the 3-year exemption. That meant their most recent claim had to be submitted between 1 October 2021 and 30 September 2024.

But the 2023 claim was both an amended return after 1 April 2023 and submitted after the exemption window.

At the time of writing, we’re still waiting to confirm when the 2022 claim was submitted – but it’s likely that was late too. The result? Company B might miss out on both the 2023 and 2024 claims.

All of this was avoidable.

Our take?

It’s not enough to assume previous claims protect you from an enquiry. The R&D landscape has changed, and businesses need to adapt.

The lesson is simple: don’t wait until the deadline is on your doorstep. And don’t cut corners with low-cost advisers.

Because while saving money might feel smart today, it could cost you much more tomorrow.