Like so many companies recently, our client, a prominent manufacturer within the construction industry, faced a significant challenge when claiming R&D tax relief for perfectly legitimate expenditure. In recent years, businesses have experienced heightened scrutiny from HMRC, with an increasing number of claims being rejected without clear justification.
For this client, three consecutive years of R&D tax relief claims were denied, despite meeting the eligibility criteria. The stakes were high – if the client lost their appeal, they risked not only losing substantial tax benefits but also incurring additional penalties.
Our approach
Determined to protect the client’s interests, and having exhausted all previous opportunities to resolve the queries with HMRC, we launched an appeal to the independent tax tribunal. Our team prepared a comprehensive 58-page appeal, including a highly detailed technical report, setting out the validity of the claims and aligning them with the law and HMRC’s guidelines.
This collaborative effort brought together specialists across multiple teams, ensuring every aspect of the client’s R&D activities was accurately represented and supported by robust evidence and clear litigation advice.
Outcome
Just before the tribunal hearing, a senior HMRC official reviewed the grounds for appeal and acknowledged that HMRC did not have a case. He even commended the quality and depth of our report.