Why HMRC Is Rejecting More R&D Claims (And How to Make Sure Yours Isn't Next)

If you run a tech company and you've claimed R&D tax relief before, you've probably felt the shift.

What used to be a fairly straightforward process, submit your costs, wait for the credit, has turned into something closer to an audit. HMRC has tightened the rules, and it's actively looking for reasons to say no.

The good news is that almost every rejection we see comes down to one of three preventable mistakes. Here's what's catching companies out, and how to stay ahead of it.

1. Missing the six-month notification window

This is the one that trips people up because it feels like it shouldn't exist. If you're claiming R&D relief for the first time, or you haven't made a claim in the last three years, you now have to tell HMRC you intend to claim before you actually claim.

That notification, the Claim Notification Form, has to go in within six months of the end of your accounting period. So if your year ends on 31 December, your deadline is 30 June, not whenever you get round to filing your Corporation Tax return.

Miss it, and that's it. There's no grace period and no appeal. The relief for that entire accounting period is gone, even if the R&D itself was completely genuine.

What to do: treat this as a mid-year task, not a year-end one. As soon as you know a project might qualify, flag it and get the notification in. Don't wait for your accountant to raise it at filing time, by then it may already be too late.

2. Submitting a weak Additional Information Form

Since the Additional Information Form (AIF) became mandatory, it's turned into the main battleground for claims. Miss it entirely and HMRC will strip the R&D claim out of your return automatically, no discussion.

But submitting one isn't enough on its own. HMRC uses the AIF to test whether what you did actually counts as R&D under the tax rules, and that's a narrower definition than most founders expect. Rebuilding your app, migrating to the cloud, or adopting a new framework might genuinely improve your business, but if you're using established technology in an established way, HMRC won't count it.

What gets claims rejected here is usually vague writing: descriptions that read like a pitch deck rather than an explanation of a real technical problem. HMRC wants to see the specific uncertainty your team faced, why the answer wasn't already knowable, and what a competent professional in your field would have found hard.

What to do: write the AIF like you're explaining the problem to another engineer, not a potential investor. Name the technical baseline you started from, the uncertainty you couldn't resolve by just looking it up, and how your team worked through it.

3. Costs that can't be backed up

This is the quieter problem, but it's just as common. HMRC no longer accepts a rough estimate at year-end of how much time your developers spent on R&D. If you're claiming that 60% of your lead developer's time went into qualifying work, HMRC expects to see evidence that was captured as it happened, not reconstructed afterwards.

Estimates that look reasonable but aren't backed by anything real are one of the fastest ways to trigger a compliance check, and if HMRC decides the figures were careless rather than just imprecise, penalties can follow.

What to do: build the record-keeping into how your team already works, rather than trying to reconstruct it later.

• Tag tickets or sprints in Jira, Asana or GitHub as R&D-qualifying as you go

• Keep timesheets that separate R&D work from routine maintenance, bug fixes and standard deployment

• Split out cloud and software costs so you're only claiming for the environments actually used for R&D testing

The bigger picture

None of this means R&D relief has become out of reach, it means the standard of preparation has gone up. Companies that treat it as a live process throughout the year, rather than a scramble before the filing deadline, are the ones still getting paid without a fight.

If you're planning a claim for this accounting period, see how Zyla can help. We'll help you get the notification timing right, build an AIF that actually holds up to scrutiny, and put the record-keeping in place so your numbers are never in question.