The Meaning of Research and Development for Tax Purposes

Published on 31 October 2023 HMRC have published an update expanding on their Guidelines for Compliance (GfC) with regards to the meaning of Research and Development for tax purposes.

The purpose of this update is to help companies avoid common mistakes in their R&D claims and aims to provide clear signal so that claimants understand:

HMRC expectations;

-the meaning of “Scientific or Technological advance” for the purpose of R&D claims; -the uncertainty that the project is seeking to resolve; -the definition of a “Competent Professional” within the context of R&D for tax purposes and; -the evidence¬† HMRC may expect to see for a claim if subject to an enquiry

These helpful updates are clearly seeking to address the much publicised abuse of R&D tax incentives with a huge rise in questionable, if not fraudulent, claims.

A link to the update is below for ease and we encourage all stakeholders to review the same:


Many R&D “experts” are accused of viewing the government incentive as a honey pot enforcing the “if you do not ask you do not get” approach, which is clearly not operating in the spirit of the law and seeks to take advantage of the fact that HMRC simply do not have the resources to check every single claim. As a result, it is understood that many claims have been processed incorrectly in recent years resulting in “no win no fee” firms profiting from mistaken interpretations over what constitutes as a qualifying project.

It is clear more than ever that HMRC are seeking to address this going forward and both company claimants and R&D agents are advised to take greater care in their claim preparation going forward which, if found to be incorrect, could leads to significant penalties for carelessness.

Buzz are committed to working with innovate companies who have legitimate and robust R&D claims and might be seeking an advance against their claim part way through their accounting period.

If you are 9 months into your accounting period and can evidence qualifying expenditure towards a project then please get in touch.

You can get your funds now with a short term and non-dilutive loan from Buzz Capital.

We will be pleased to have a confidential, non-nonsense and straightforward discussion surrounding your cashflow requirements.