Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of legislating to require HMRC to pay Research and Development tax credits within 40 days.

HMRC changed its Research and Development tax credit service level commitment from 28 to 40 days in April 2022. This followed a suspected criminal attack on the small and medium sized company scheme, which led to the introduction of additional security checks to prevent fraud.

HMRC aims to reintroduce its commitment to process 95 per cent of claims within 28 days as soon as possible.

The need for operational flexibility to respond quickly to challenges like this means that it would not be appropriate to set a target in legislation. Legislating a fixed timeline could result in more paid out on error and fraud.