Softening of compliance measures will make it easier for companies to access R&D Tax Relief and improve trust in the scheme.
In today’s Budget 2026 announcement, the government unveiled two major changes to the R&D Tax Relief scheme: the removal of the claim notification form requirement and the simplification of the additional information form (AIF).
Both changes, which will come into effect in 2027, will make it easier for companies to access this vital source of non-dilutive capital and mend some of the distrust and damage caused by the burdensome compliance tactics that have deterred eligible companies from making claims.
Key Takeaways
- The claim notification form will be scrapped. This will affect claims filed on or after 1 April 2027
- The government has promised to simplify and ‘rationalise’ the additional information form from Autumn 2027
- This should make claiming less time-consuming
- These changes haven’t come into effect yet. Companies claiming now must remain compliant with the current rules, including any CNF deadlines that fall before 1 April 2027
- Both changes, plus HMRC moving its compliance focus away from SME claims, suggest the government is looking to make the scheme more accessible for startups and scaleups
Claim Notification Form to be Scrapped
The government announced it will remove the claim notification form (CNF) requirement for R&D Tax Relief claims made on or after 1 April 2027.
The claim notification form to be scrapped
Under the current CNF requirement, companies that have never claimed R&D Tax Relief before or in the last 3 years or, in certain cases, have filed a previous claim by amending their CT600, need to submit a form informing HMRC of their intention to claim.
They need to do this within 6 months of the end of the accounting period they are claiming for. For example, if a company’s period of account ended on 30 September 2026, they need to submit a CNF by 31 March 2027.
Companies that have to submit a CNF but miss the deadline will forfeit their ability to claim relief.
Check If You Need to File a CNF
How will this impact companies claiming R&D Tax Relief?
This is unquestionably good news for companies claiming R&D Tax Relief.
Removing the CNF means less paperwork for busy businesses, giving them more time for core activities like innovation and growth.Â
It’s especially good news for young startups. Many startups neglected to file a CNF, either because they didn’t have capacity or weren’t aware the requirement existed. This minor oversight deprives them of valuable funding.
That said, this rule is still in effect. Companies can’t afford to get complacent. If you are unsure if you need to file a CNF, or want help ensuring you file it on time and compliantly, just get in touch.
The broader impacts of this change
From the announcement, we know that companies that claim R&D Tax Relief after 1 April 2027 won’t have to file a CNF.Â
What we don’t know is whether companies who missed their CNF deadline can simply wait until 1 April to file their claim. That’s assuming their two-year claim deadline hasn’t expired. So, this would only apply to claims ending on or after 1 April 2027.
If this is the case, we could see an influx of claims in April-May time. This would be bad news for HMRC. The tax authority is already stretched during this time by other filings connected to the end of the tax year.Â
As a result, we may see processing times increase, depending on the scale of the influx. Companies that want to access their R&D tax relief as soon as possible can do so via our R&D Advance Funding service.
Stay Up to Date with HMRC
HMRC’s approach to enquiries changes constantly. Don’t get left behind.
Keep up to date by signing up for GrantTree’s monthly newsletter.
The Additional Information Form to be Simplified
The government also announced it will simplify and ‘rationalise’ the information required in the additional information form (AIF).Â
This will take effect for companies claiming R&D Tax Relief from autumn 2027 and be delivered through secondary legislation. Until then, the current AIF rules still apply.
What is the AIF?
The additional information form is a form that companies must submit to HMRC when they claim R&D Tax Relief.
In it, companies must provide a range of technical and financial information, including detailed project breakdowns, about the development work they are claiming relief on.Â
The AIF was introduced in August 2023 as part of a range of measures designed to reduce the cost of non-compliant claims. It must be submitted before or at the same time as a company’s CT600.
It allows tax inspectors to see what work companies are claiming for, enabling them to spot questionable or downright ineligible work more easily.
How will this impact companies claiming R&D Tax Relief?
Again, this is good news. The introduction of the AIF drastically increased the amount of work companies had to do to claim R&D Tax Relief.
It means that senior members of companies’ development teams need to take time away from high-value R&D to complete paperwork, a costly distraction for startups and scaleups.Â
I hasten to add, the cost of this distraction is significantly less for our clients. We prepare their AIF, and collect the data needed to do so in a way that protects their people’s time and dovetails with their internal processes.Â
The line the government has to tread is to simplify the AIF while ensuring it still does its job: allowing HMRC’s inspectors to review a claimant’s qualifying work and identify non-qualifying R&D.
A Better Environment for R&D Tax Claimants
This news follows HMRC’s recent announcement that it is now focusing on reducing non-compliance in larger claims and moving away from SME filings.
The net result is a scheme that R&D Tax Relief will be easier to claim, with a lower risk of undue scrutiny, via compliance checks, for eligible claimants.
Hopefully, this will reverse some of the mistrust the scheme has accrued from its heavy-handed compliance approach, while ensuring HMRC can still police the scheme effectively.
Make the Most of the R&D Tax Changes
To understand how these changes impact your company, and ensure your are positioned to maximise their impact on your company’s claim, just get in touch. My colleagues and I in GrantTree’s R&D Tax Relief team will be happy to help.
