Is HMRC introducing an advance clearance system for R&D claims?

Not a formal, binding clearance system in the sense that term is used elsewhere in tax practice. What HMRC has actually introduced, following a 2025 consultation, is an expanded advance assurance pilot — two separate services, both non-statutory, both conditional on the facts staying as described, running from 18 May 2026 to May 2027. A genuinely binding, potentially mandatory pre-claim system was one of three options the consultation considered, and remains under review with no committed timeline.

Is There an R&D Advance Clearance System?

Where this came from — the 2025 consultation

HMRC’s existing advance assurance scheme — a long-standing but little-used facility, run at roughly 80 applications a year — was the starting point for a formal consultation, launched at Spring Statement 2025 and open from 26 March to 26 May 2025, on whether to introduce a more substantial advance clearance system. The consultation set out three options:

Pre-activity clearance. Earlier, informal discussion with HMRC before R&D work begins, on a voluntary basis. Limited legal certainty; framed mainly as a customer-experience improvement.
Pre-claim clearance. Binding assurance covering the whole claim, potentially made mandatory for companies in specified sectors. Framed as the option most directly aimed at reducing error and fraud.
Post-claim, pre-payment clearance. A voluntary check available after a claim is made but before any payment is released, aimed at addressing concerns about payments being withheld or rescinded later.

The government’s own framing at the time was that it would “announce its preferred approach later in the year” — and it did, at Autumn Budget 2025 on 26 November 2025.

What HMRC actually introduced

The Autumn Budget 2025 announcement was a limited pilot of a new targeted advance assurance service, addressing one specific piece of consultation feedback — that assurance should be available beyond first-time claimants only — while leaving other questions, including a possible minimum expenditure threshold, undecided. It launched on 18 May 2026 as two distinct services, sitting alongside each other:

Targeted advance assurance. Available to SMEs only, whether first-time or repeat claimants. You can make up to two applications, each covering exactly one project and one of four defined areas: whether a project meets the definition of R&D for tax purposes; whether overseas expenditure qualifies for relief; whether contracted-out R&D relief applies where the work is done for another company; or whether the company qualifies for exemption from the PAYE and National Insurance contributions cap. You can’t apply if you, or a connected person, have entered a disclosable tax avoidance scheme, been categorised as a Corporate Serious Defaulter, or have an open corporation tax enquiry. HMRC aims to process an application within 40 calendar days, provided you supply complete and accurate information.

Full claim advance assurance. Narrower eligibility, broader coverage. It’s only available where this is genuinely your company’s first R&D claim, and no company linked to it in a group has claimed before. The company must also meet the SME thresholds of turnover under £2 million and fewer than 50 employees. Where granted, it covers the whole claim rather than a single area, and the agreement applies across the company’s first three accounting periods — not just the one being assessed. You can’t apply for both services covering the same period.

Why this isn’t the “binding clearance” some were expecting

Both services stop well short of Option B from the consultation — a mandatory, sector-specific, binding pre-claim regime. Two features of how they actually work show this:

The assurance is conditional, not absolute. HMRC’s confirmation letter explains the company’s ongoing responsibilities and what happens if the R&D activities change from what was described. Assurance granted on the facts as presented doesn’t survive material changes to those facts — it’s closer to a qualified, fact-dependent undertaking than a court-tested, binding clearance.

A refusal is final, for that period. If HMRC declines to give assurance, you can’t appeal the decision or apply again for the same period. That’s a meaningfully different posture from a genuine clearance regime, where a refused application would typically still leave the underlying claim open to be made and argued on its merits through the normal process.

Both services are also entirely voluntary and non-statutory — there is no legislative basis requiring a company to seek assurance, and no legislative basis giving the assurance letter any special status if a dispute later reaches an enquiry or the tribunal. What’s actually been introduced sits closest to a substantially expanded version of Option A, not Option B.

Worked example

A software company making its first-ever R&D claim has a reasonably confident technical position, but is genuinely unsure whether its PAYE and NIC cap exemption applies given an unusual mix of connected-party shareholdings. It has two realistic choices. Full claim advance assurance would cover the whole claim — including the cap question — and lock in HMRC’s view for the first three accounting periods, but a refusal (on any aspect of the claim, not just the cap question) forecloses reapplying for that period entirely. Targeted advance assurance would answer only the cap question specifically, leaving the rest of the claim to go through the normal process without HMRC’s advance view — but a refusal on that one narrow point doesn’t touch the company’s ability to make the wider claim on its own merits. Which is the better choice depends on how confident the adviser is in the rest of the claim, not just the specific point in doubt — full claim assurance is only attractive where the whole position is strong, because a weak point anywhere in the claim can sink the whole application.

Where claims go wrong

Treating an advance assurance letter as if it were a binding clearance regardless of what happens later. It isn’t. If the R&D activities change materially from what was described, the protection goes with them.
Applying for full claim advance assurance without checking every linked group company’s claim history first. One earlier claim anywhere in the group is a straight disqualification, discovered only after the application is refused.
Not realising a refusal is final for that period. There’s no route to appeal it or have another go — the decision to apply should be made with that finality in mind, not treated as a low-risk first attempt.
Assuming DOTAS involvement, Corporate Serious Defaulter status or an open enquiry can be worked around at application stage. These are straightforward exclusions, not factors HMRC weighs — they should be resolved, or the application shouldn’t be made at all.
Expecting either service to reduce the chance of a wider compliance check. Assurance on one project and one area doesn’t touch the rest of a claim, or a future year’s claim, and isn’t a substitute for the record-keeping described in What records do I need to keep to support an R&D tax relief claim?