Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Readers’ forum: Elections for connected persons treatment for research and development

03 May 2022
Issue: 4838 / Categories: Forum & Feedback
Research and development

In respect of research and development (R&D) relief claims we are aware that broadly payments to a subcontractor by SMEs are restricted to 65% under CTA 2009 s 1136 unless the subcontractor is a connected person. We are also aware that it is possible to enter into joint election in writing within two years under s 1135 such that s 1134 applies as if the two parties were connected.

Commentary in HMRC’s manuals appears to be limited to a remark under CIRD82000 which simply reiterates the legislation without offering any further background of details.

It is quite possible that we are missing something obvious here but assuming the subcontractor is reporting their income to HMRC can anyone provide further commentary as to any reasons why a contractor and/or subcontractor would not wish to enter into such an election? Are there any inter-party disclosures that...

If you or your firm subscribes to Taxation.co.uk, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.

back to top icon