In October 2023 HMRC published guidance (GfC3) on the process it expects claimants to follow when preparing a claim for R&D tax relief. Much of this guidance is the same as that found in the CIRD. However, the GfC3 also contains details what constitutes a competent professional, and why this matters. We've reproduced this advice here:

A competent professional in the field can judge if a scientific or technological advance is needed to solve a particular problem. This person can:

• judge what is or is not an advance on the current state of what is known and understood
• identify R&D activities seeking an advance and state where they begin and end

You need that information to make a correct claim.

Competent professionals

A competent professional is someone suitably qualified or experienced in the field. Usually this is someone directly involved in the project with professional expertise relevant to the advance being sought.

HMRC have reduced the value of some claims to zero when a competent professional has not identified that a company was seeking an advance in science or technology. 

HMRC see a common error when identifying a competent professional. Having worked in a field or having an intelligent interest alone, do not make a person a competent professional. They must have enough knowledge and experience relevant to the qualifying project.

In respect of their field of expertise, HMRC expect a competent professional to have all the following attributes:

• they must be knowledgeable about the relevant scientific or technological principles involved
• they must be aware of the current state of knowledge in the field as a whole
• they must have accumulated experience and have a successful track record

A competent professional may work for your company, or they may not.

Evidence of being a competent professional

Good evidence may include one of the following examples:

• high level qualifications in the field, alongside continuous professional development
• a significant number of years’ experience working at a high level in the field
• a good scientific publication record in the field
• industry awards
• other public recognition for contributions to the field

Opinion of a competent professional

The opinion of a competent professional should set out clearly, and as far as possible without jargon:

• the depth of the competent professional’s knowledge and experience in the relevant field
• the current state of relevant knowledge in the field
• what the advance in science or technology being sought is
• why what is being sought is an advance in the field
• how the advance relates to knowledge, capability, or a mixture of the two

HMRC will give due weight to an opinion offered by the company’s competent professional but further enquiry may still be needed, especially where the opinion omits information set out above.

There may be differences of opinion between competent professionals in a particular field. Where the view taken is a legitimate one, reached by a competent professional properly exercising expert judgement, then it would normally be acceptable.

Examples of competent professionals

Example 1.1

A textile company is working to develop a new in-house software system. The company IT team is inexperienced and lacks high-level qualifications. Without speaking with a competent IT professional, the company cannot identify any qualifying technological uncertainty. This is because this team is not able to define what advance, if any, its project is seeking.

Example 1.2

Ben is a director of a patio tile company. He has many years’ experience working in his company’s wholesale trade and has won several industry awards. He wishes to make efficiencies in stock management by investing in development of a new computerised stock management system. IT professionals undertake the work. Ben is not a competent professional for the purposes of identifying any scientific or technological advances sought by the project. His competency lies in the patio tile wholesale trade, not in the specialist area of stock management IT systems. The IT professionals may be competent professionals able to identify if the project seeks an advance in science or technology.

Example 1.3

Hassan is the managing director of a successful engineering firm. He has higher-level engineering qualifications and has 30 years’ experience working hands-on in engineering projects within his company’s specialist area. Hassan is well-placed to identify qualifying R&D activity being undertaken as part of his company’s commercial projects. Hassan is a competent professional in his field.