A grant paid for part of the project. Can you still claim?

It helps and it constrains. The application and monitoring reports are useful contemporary evidence of what you set out to achieve and what you found. But grant documents describe aims in a funder's language, and the R&D test is about uncertainty and advance. We use the grant papers as supporting material and build the claim's technical case from the project records and the people.

The rules turn on when the accounting period begins, not when the costs were incurred. A period beginning on or after 1 April 2024 falls under the merged scheme and ERIS, where HMRC says there is no restriction on subsidised costs. A period beginning earlier follows the old rules. We start every grant question by confirming the period.

For periods beginning on or after 1 April 2024, HMRC says there is no restriction on claiming for subsidised costs under the merged scheme or ERIS, so the grant does not reduce the qualifying costs. For earlier periods, the subsidised part could be restricted. The period decides the answer, which is why we check it first.

For contracted-out work, the company that decides the R&D needs doing, and can evidence that decision. If you pay a partner to do work you have decided on, it is contracted-out R&D, and unconnected providers' costs are counted at 65%. Each partner should look at its own position, not assume. We review the agreement and the roles.

Tell us. A repayment can change the facts the claim was built on, particularly for older periods where grant rules applied. We review the claim for that period under the rules in force, and tell you whether anything needs adjusting. Do not wait for it to come up in an enquiry.

Yes, as evidence made at the time. Milestone reports show what you attempted, what failed and what changed, and that is the stuff of uncertainty. But they are often written to show success to the funder. We read them for the problems and set-backs, which are what the R&D claim needs.

Yes. The Government's guidelines say a project that fails can still be R&D. Whether it qualifies depends on the uncertainty and the attempt to resolve it, not on the outcome. A grant that is not renewed, or a milestone that was missed, does not make the work any less eligible.

Large companies claimed under RDEC in any case. The grant rules mainly affected SMEs: where the project received notified state aid, only RDEC was available, and where a grant covered part of the costs, the SME scheme applied to the uncovered part, with RDEC possibly available for the subsidised part. These rules still matter for late claims, amendments and enquiries. We check the period, then the grant terms.

Possibly. If a claim for a period under the older rules did not allow for a grant that restricted it, the claim may have been overstated. We review the claim and the grant papers, work out the effect and set out the options. Telling HMRC unprompted generally leads to lower penalties. See our page on correcting past claims.

Under the older rules, yes. For the SME scheme, you could not claim where the project was subsidised by a grant, but you could claim on the unsubsidised part. That meant working out which costs the grant covered. It is a point we check in every review of an older claim.

They should be consistent. If the grant report says a team of five spent the quarter on a task, but the claim apportions time to R&D differently, HMRC may ask why. We compare them before filing and explain the difference, such as work that was grant reporting rather than R&D. Consistency is a sign of a careful claim.

The costs you pay for R&D can qualify if they meet the rules for qualifying costs, such as staff time, consumables, software and cloud. That the grant also covered part of the project does not stop this for periods from 1 April 2024. Costs must have been paid before the claim is made. We trace each figure to a record.

Yes. Keep project records from the start, make sure grant reporting and claim records agree, and decide who decides the R&D if partners are involved. We can review the application and the budget before you commit. It costs little at that stage and saves a good deal of reconstruction later.

They can. A late claim, an amendment or an enquiry for a period beginning before 1 April 2024 is dealt with under the rules of that time, including those on subsidised expenditure. The time limit is generally two years from the end of the period of account, so check it first with our time-limit checker.

Not under the current pilot. Targeted advance assurance covers four areas: the R&D definition, overseas expenditure, contracted-out R&D and the PAYE cap exemption. Grants are not one of them, and for periods from 1 April 2024 they do not restrict the claim anyway. For older periods, we review the position ourselves.