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Company was entitled to R&D credit as its project satisfied the relevant guidelines

By Mark McLaughlin, October 2024

A company’s project constituted research and development within the meaning in the BEIS Guidelines, and HMRC’s argument that it did not without adequate reasoning was insufficient for the claim to be denied. 

The appellant (GOL) made a claim for research and development (R&D) tax credit (under CTA 2009, s 1054). GOL’s advisers described the project: “[GOL] sought to develop a novel, automated artificial intelligence (AI) analysis process for ‘know your client’ (KYC) verification and risk profiling. The main objective of this project was to develop AI-enabled holistic analysis of a new counterparty during a financial services customer onboarding process that could achieve a superior outcome to human analysis and meet all regulatory and legislative requirements.” HM Revenue and Customs (HMRC) rejected GOL’s claim on the basis that its project did not advance overall knowledge or capability and therefore did

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