In Hadee Engineering Co Ltd v HMRC [2017] TC06272, the First Tier Tribunal (FTT) ordered a closure notice issued where the taxpayer had provided all the information available in respect of its claim for Research and Development tax credits.

Where a company conducts Research and Development activities (R&D), an additional tax deduction is available and, if this creates a loss, a refund can be claimed from HMRC.

Hadee submitted claims for repayment of RDEC in respect of its 2009 and 2010 accounting periods. HMRC opened an enquiry into these claims under its Code of Practice 9 (COP9) “Civil Investigation into cases of Suspected Serious Fraud” in 2010. In 2017, Hadee applied for a tribunal for a Closure Notice on the grounds that the enquiry had been unduly prolonged and Hadee had no more informaiton they could provide.

Various information requests were sent to Hadee and third parties, but HMRC did not believe that they had enough information to confirm that the taxpayer had met the first hurdle of claiming to be involved in R&D. 

On the basis that no more information was available, the FTT ordered HMRC to issue a closure notice (which will presumably deny R&D relief) and did not consider other grounds raised by Hadee.


This case should not be confused with TC06270. On the same day, the same FTT overturned a penalty raised on Hadee for failure to comply with a Sch 36 FA 2008 Notice.


Closure Notices

R&D Tax reliefs: introduction (Freeview)

R&D Tax Relief (subscriber version)

Code of Practice 9


Hadee Engineering Co Ltd v HMRC [2017] TC06272 (this case)

Hadee Engineering Co Ltd v HMRC [2017] TC06270  (the Sch 36 penalty)