The Chartered Institute of Taxation (CIOT) is warning that HMRC’s efforts to tackle abuse of the R&D tax relief system are resulting in them rejecting legitimate claims and stone-walling others.
In a letter to HMRC, the CIOT wrote that the ‘volume compliance’ approach adopted by the tax authority since the second half of 2022 does not work because of the complex nature of the relief.
Ellen Milner, CIOT director of public policy, said: “We are receiving a large number of reports about the difficulties being encountered by firms carrying out genuine R&D.
“Valid claims are being rejected and businesses are being deterred from challenging HMRC by the disproportionate financial and time cost of doing so.
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