Corporation Tax Act 2009 section 1112H

No credit payable if certain tax matters outstanding

Section 1112H prevents HMRC from having to pay out R&D expenditure credits or R&D tax credits where there are unresolved tax compliance issues.

• This section applies to amounts a company would otherwise receive as a payable R&D expenditure credit (under section 1042I) or an R&D tax credit (under section 1054).
• Where HMRC has opened an enquiry into the company's tax return for the relevant accounting period, HMRC is not obliged to pay the credit, although an officer may choose to make a provisional payment of whatever amount they consider appropriate.
• Where the company has outstanding PAYE or National Insurance Contributions liabilities for the accounting period, HMRC is not obliged to pay the credit at all.
• A company is treated as having outstanding PAYE or NIC liabilities if it has failed to pay any amounts due under PAYE regulations or in respect of Class 1 National Insurance Contributions for payment periods ending within the accounting period in question.