An R&D tax relief compliance letter is HMRC’s way of communicating with you that they need more information to clarify questions about your R&D claim. This process is known as an enquiry. It is important to remember that compliance checks look at your company tax return, so they can be quite broad in scope.
What happens if HMRC check shows nothing wrong?
If the check shows there is nothing wrong, we’ll bring it quickly to an end. If our checks show you have overpaid tax, you will be repaid with any interest due added. If you have underpaid tax, you will need to repay this. You will be charged interest and you may receive a penalty.
What to do if you owe tax to HMRC?
If after the checks, we conclude that you owe us tax, but you cannot afford to pay it immediately, contact the HMRC coronavirus (COVID-19) helpline. You can talk to us about payment arrangements that you can afford.
What to include in a compliance check letter?
A common factsheet to be included is the CC/FS1a ‘About compliance’ checks. These factsheets can add bulk and an opening letter can run to nine or ten pages, but usually only one of these contains questions you need to answer. The rest will be background information and guidance. Why have I received a compliance check letter?
Do you have to respond to HMRC verification letters?
Some self assessment taxpayers have received letters from HMRC asking for information to verify that repayment claims are not fraudulent. ICAEW’s Tax Faculty confirms that taxpayers are under no legal obligation to respond but may have claims cancelled or delayed if they do not.
Can a HMRC check into a tax return?
The second version of the letter states that it is not a check into the return under s9A, Taxes Management Act 1970, which means that HMRC retains the ability to open an enquiry into the return once it has established that the claim is genuine and not fraudulent.
When did HMRC start carrying out compliance checks?
However, as a back-up, HMRC carries out compliance checks on a proportion of returns to ensure that the correct amount of tax has been paid. The rules governing compliance checks have been revised and standardised such that from 1 April 2010 a single system applies across many taxes.
