Is it possible for a company in liquidation or no longer in operation to make an R&D claim?

One of the eligibility requirements for R&D tax relief is that the business claiming R&D tax relief must be trading. In practical terms, this means the company needs to exist as a legal entity and be carrying on a trade during the accounting period for which the claim is made.

If a company’s registration has been dissolved or the entity has ceased to exist, it will generally no longer be able to submit an R&D tax credit claim in its own name. The R&D tax relief is tied to the company that incurred the qualifying expenditure while undertaking the eligible R&D activity.

There are situations where R&D work continues under a different company structure. For example, a business may acquire or absorb another limited company as part of a merger or purchase. In these cases, it may still be possible to prepare and submit R&D tax credit claims relating to the relevant accounting periods before the structural change, provided the qualifying activity and expenditure can be evidenced.

In the past, we have helped to prepare R&D tax credit claims for clients who have absorbed and bought a limited company, however this relies entirely on ensuring that the qualifying R&D activity and expenditure were properly documented for the accounting periods in which the work was carried out.