If your business carries out Research and Development, there are two important updates you need to be aware of right now. One is genuinely good news. The other is a cautionary tale that every business considering an R&D claim should read carefully.
A New Way to Get HMRC’s Blessing Before You Claim
HMRC has launched a new Targeted Advance Assurance pilot for R&D tax relief, which opened on 18 May 2026 and will run for 12 months. It is free of charge, voluntary, and specifically designed for small and medium-sized businesses.
The idea is straightforward. Rather than submitting a claim and waiting to see if HMRC pushes back, eligible SMEs can now approach HMRC in advance and get clarity on the trickiest parts of their claim before they file. This is particularly useful if your R&D involves any of the following:
- Whether your project genuinely meets the definition of R&D for tax purposes
- Whether overseas expenditure qualifies for relief
- Whether R&D relief can be claimed where one company contracts work to another
- Whether your company qualifies for an exemption from the PAYE and National Insurance contributions cap
It is worth noting that this new pilot runs alongside the existing full claim advance assurance service, which remains available but is restricted to first-time claimants only. The new targeted scheme is open more broadly to any eligible SME, regardless of whether they have claimed before.
If you are planning an R&D claim and there are areas where you are genuinely uncertain, this pilot could be well worth exploring. Get in touch and we can help you assess whether it is right for your situation.
A Tribunal Case Every R&D Claimant Should Know About
At the same time as this new pilot was launched, a significant First Tier Tribunal decision was handed down that serves as a sharp reminder of what can go wrong when R&D claims are not handled properly.
In Beer Express Ltd v HMRC [2026] UKFTT 672 (TC), a wholesale drinks business from the North of England lost its appeal against HMRC’s decision to disallow R&D tax relief totalling over £490,000 across two accounting periods.
The company had been approached by a third-party R&D advisory firm, which identified several of Beer Express’s operational projects as potentially qualifying for relief and prepared the claims on their behalf. When HMRC challenged those claims, the advisory firm had become uncontactable, leaving Beer Express to defend a case it could not fully explain.
The Tribunal’s findings were damaging. The supporting reports were described as vague and unconvincing, offering little more than high-level descriptions of the work carried out. There was no clear explanation of the technological baseline the company was working from, no defined advance in science or technology, and no identification of the genuine technological uncertainties the projects were trying to resolve. Crucially, there was no input from a competent professional with the technical knowledge to explain why the work qualified.
The Tribunal found Beer Express’s director to be honest and credible, but that was not enough. The appeal was dismissed in full.
This case is not an isolated incident. HMRC has significantly increased its scrutiny of R&D claims in recent years, and poorly evidenced claims are increasingly being challenged. The message is clear: R&D tax relief is a genuinely valuable relief, but it has to be claimed correctly, with proper technical evidence and proper professional support.
What This Means for Your Business
Whether you are considering your first R&D claim or have been claiming for years, now is a good time to ask some honest questions:
- Is your claim supported by clear technical evidence, not just high-level descriptions?
- Can someone with genuine technical knowledge explain why your work qualifies?
- Do you know exactly who would defend your claim if HMRC came knocking?
At A&C Chartered Accountants, we work with businesses across Manchester to make sure their R&D claims are well-founded, properly evidenced and compliant. We can also help you assess whether the new HMRC advance assurance pilot is worth pursuing before you file.
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This article is based on HMRC guidance and publicly available tribunal decisions current as of June 2026. Tax rules can change. Please speak to a qualified accountant before making decisions based on this content.