Many R&D claims are now being challenged by HMRC. This is quite a change from the way it used to be. These investigations can be time consuming and challenging.
One of the factors that can lead to a challenge is the SIC code recorded against your company at Companies House. The SIC code enables them to focus on certain trade sectors that they consider to be high risk.
It has been found that claims from the following sectors are rarely successful:
- Care homes.
- Childcare providers.
- Personal trainers.
- Wholesalers and retailers.
- Real estate agents.
- Textile industries.
- The construction industry.
- Educational institutions.
- Consultancy firms.
Claims from these sectors are therefore more likely to be challenged.
It looks, therefore, that the often neglected SIC, is now becoming more crucial and should be regularly reviewed to ensure it properly reflects what you are doing now and not what you planned when the comopany was set up.
You don’t want a challenge because your old SIC code, now out of date, is from one of HMRC’s targets.