The additional information form (previously technical justification) is a written record of the projects containing R&D that have been undertaken in the previous financial year, and how this work is an advance in science or technology.
What needs to be included in the additional information form?
In the last several years, there have been lots of changes in the R&D scheme, including a change in the way claims are submitted. Previously the claim was submitted with your tax computations by your accountant. Since August 2023 additional information forms have to be onto an online HMRC portal. We will generally do this for our customers.
For each project you wish to claim R&D for, there is a set of questions that need to be answered.
- What is the main field of science or technology?
- What is the baseline level of science or technology that the company intends to advance?
- What advance in scientific or technological knowledge did the company aim to achieve?
- What scientific or technological uncertainties did the company face?
- How did your project seek to overcome these uncertainties?
Answers to these questions now need to be more extensive, and care should be taken to identify supporting evidence.
What is the main field of science or technology?
This is a very important answer. There is no standard definition, or list, of fields of science or technology, and the claimant should be careful to ensure that the field (usually of technology) is closely scoped around the R&D work being conducted.
What is the baseline level of science or technology that the company intends to advance?
What was known about the science and technology before the project started and what did the company intend to advance?
- Did the project seek to develop a new product? What were the existing features and why were they unsuitable for your needs?
- What was the need to develop new knowledge beyond what is known?
- Advances must be seen to advance the defined field of science or technology and not just your company
- It is possible to seek knowledge which already exists, but is not known to you and can’t be found in the public domain
What advance in scientific or technological knowledge did the company aim to achieve?
What is the advance in relation to the company’s baseline knowledge? This can include the adaptation of knowledge from another field of science or technology if how you are applying the knowledge is not readily deducible. Examples of activities that include R&D are:
- Extending overall knowledge or capability in a field or technology
- Creating a product, process, material, device or service to increase the overall knowledge of capacity in a field or technology
- Make an appreciable improvement to an existing process, material, device, product or service
- Use science or technology to duplicate and improve an existing process, material, device, product or service using new/different science or technology
What scientific or technological uncertainties did the company face?
- When starting the project what, technically, did the company not know that it would need to know to become successful?
- What is stopping you from achieving the advance you are seeking?
- Why is it an industry-wide issue?
- Why would a competent professional in the field not be able to readily resolve the issue you are trying to overcome?
How did your project seek to overcome these uncertainties?
Details of the R&D activity the project did to resolve the uncertainties.
- In what ways was the work done on the project was not straightforward?
- What didn’t work? Why not?
- What did you do to overcome the uncertainties?
- Were you successful? If yes, why? If not, why not?
Aborted projects can still count. It is acceptable to claim for R&D tax relief where a project was unsuccessful. What counts is the intention to achieve an advance in science or technology not whether this was successfully resolved.