The HMRC R&D Crackdown: What’s Changed and Where Scrutiny Is Focused in 2025/26

If you filed an R&D tax claim more than a couple of years ago and you’re now due to file another, don’t expect the same process. HMRC’s compliance crackdown on R&D tax relief has reshaped the scheme from the ground up, and the businesses that catch us off guard in enquiries today are usually those still working from a 2021 playbook.

We’ve sat through enough of these enquiries over the last few years to see the pattern clearly. Here’s what’s actually changed, where HMRC is looking now, and what it means if you’re preparing a claim this year.

Why HMRC cracked down in the first place

Back in 2020/21, HMRC’s enquiry rate for R&D claims was around 1%. Fraud and error were rife, largely driven by volume firms submitting templated, low-quality claims with little regard for whether the work genuinely qualified. HMRC’s response was blunt: enquiry rates peaked at over 20%, and every claim now requires an Additional Information Form (AIF) before it can be processed.

It’s worked, by HMRC’s own measure. The error and fraud rate in the SME scheme has fallen from 14.7% in 2022/23 to 10.6% in 2024/25, and the overall cost of non-compliance across SME claims has fallen by more than 70% since 2021/22. HMRC now has over 500 specialists dedicated to reviewing R&D submissions — a level of scrutiny that simply didn’t exist five years ago.

Where scrutiny is heading next

The latest statistics show enquiry rates easing slightly, down to around 17% for 2023/24 claims. HMRC has said it now considers the crackdown largely successful for smaller SME claims. That doesn’t mean the pressure is off — it means the target has shifted.

Having sharply reduced SME fraud and error, HMRC’s attention is shifting to larger, more complex claims, where the pounds at risk are higher and the technical arguments are harder to unpick. If your business has moved into RDEC or the new merged scheme, or your claim value has increased year on year, expect more scrutiny, not less.

The other significant shift is structural. Claims for accounting periods beginning on or after 1 April 2024 fall under the merged R&D scheme (combining the old RDEC and SME schemes) and the Enhanced R&D Intensive Support (ERIS) scheme for loss-making, R&D-intensive SMEs. HMRC’s 2026 statistical release will be the first to report on claims under this new regime, and early indications suggest the department is treating it as a reset point — a fresh baseline for measuring compliance.

What this means for your claim

Three things matter more than they used to.

First, the AIF is not a formality. It’s now the primary lens through which HMRC assesses a claim, and a thin or generic AIF is one of the fastest routes to an enquiry letter. It needs to demonstrate genuine technical uncertainty and competent professional judgement, not merely list project titles.

Second, the quality of your technical narrative carries more weight than ever. HMRC’s specialist reviewers are, in many cases, engineers, scientists, and software professionals — not generalist tax inspectors. Vague descriptions of “improving efficiency” or “developing new features” don’t hold up. What does hold up is a narrative that explains, in specific terms, what wasn’t achievable with existing knowledge and how you tried to resolve that uncertainty.

Third, if your claim has grown or become more complex, budget more time for it, not less. A claim that took two days to evidence three years ago may now require considerably more time, particularly if you’re claiming under the merged scheme for the first time.

Our take

This is exactly why we’ve always taken an engineering-led approach rather than a templated one. When John or Jason meets your technical team, we’re not filling in boxes — we’re building the same kind of evidence an HMRC specialist reviewer would expect to see, because we understand the work well enough to ask the right questions. That’s the difference between a claim that survives scrutiny and one that invites it.

If your claim has grown, if you’re moving into the merged scheme for the first time, or if you’re unsure whether your existing narrative would withstand a 2026-level review, now is the time to check — not after the enquiry letter arrives.

Book a no-obligation call with John or Jason to discuss where your claim stands: www.vantagernd.co.uk/book-appointment

Alternatively, send us a brief overview of your projects for a free Loom video review: www.vantagernd.co.uk/review-your-project