Can replicating innovation count as valid R&D work?

At its core, R&D work is about seeking an advance that resolves a scientific or technological uncertainty.

While this will generally be synonymous with creating something new, the reality of what can be considered valid R&D is more nuanced.

Some innovative businesses set out to replicate innovations and the accountants helping them need to understand the validity of such projects.

Does an advance in R&D have to be something entirely new?

HMRC will have an easier time accepting that a project is eligible for R&D tax relief claims if it establishes an entirely new product or process or develops entirely new knowledge.

However, there are times when it is possible to undertake work to replicate innovation in a way that is valid for an R&D tax relief claim, but only when certain conditions are met.

A project cannot be considered an advance if the goal of the project is known, as this removes the essential element of scientific and technological uncertainty.

Just because an advance has been achieved by another company does not mean that every aspect of it is public knowledge.

Innovative businesses are keen to protect their secrets, so are unlikely to explain in detail how they successfully achieved an advance.

If something is known to be possible but the way to do it is not known, then an advance may be sought in replicating it.

This is beneficial for cases where two businesses are competing for the same advance and one succeeds before the other.

The business that lost the race may still have grounds to continue its work if the other business does not disclose how the advance was achieved.

Even if it becomes known, there will still be scope to submit an R&D tax relief claim for the work done prior to the release of this information.

Another example of a valid project could be in the form of figuring out a trade secret in order to make the product or process more widely available.

The key factor of eligibility for all of these examples is the accessibility of knowledge – provided that it is not publicly known and cannot be readily deduced by a competent professional, then it may be a valid project.

To add another layer of complexity, there are some instances where the advance can be public knowledge, yet R&D is still valid.

This is when the advance has found a new or appreciably improved way to replicate the effect of an existing process, material, device, product or service.

Here, it would be necessary to prove that the project is an appreciable improvement and justify why the novel approach had not been considered by those who routinely use the existing process, material, device, product or service.

How can I help my clients with R&D projects that replicate an advance?

Given that it is an area where HMRC may apply greater scrutiny, it is worth seeking the support of an expert R&D tax consultant.

We can help innovative businesses and the accountants supporting them to approach R&D tax relief claims with confidence.

Where a project is seeking to replicate an existing advance, there will be a greater need to demonstrate the existing state of knowledge.

This will mean competent professionals detailing why the success of another company should not invalidate the efforts of other innovators.

Without strong proof that this kind of work was based on a lack of knowledge, HMRC will use the existing advance as a cause to launch an enquiry into the R&D tax relief claim.

Even if this evidence is provided, an enquiry is still likely, so preparation is key.

By seeking our support, we can clear up some confusion by ensuring that the project does meet HMRC’s criteria for valid R&D before beginning work on the R&D tax relief claim.

The conversations we have to construct this R&D tax relief claim will involve gathering the data needed to justify the work to HMRC and can be revisited in the event of an enquiry.

Replicating an advance can sometimes qualify as valid R&D, but it needs to be closely assessed and have an expertly prepared R&D tax relief claim to avoid potential issues.

Get in touch with our team for R&D tax relief support for any type of valid R&D work.

Adam Bointon

Adam Bointon is a Technical Director specialising in R&D Tax Credits for SMEs in manufacturing and software sectors. With over 15 years’ experience, he works closely with businesses to identify qualifying R&D activities and prepare clear, compliant claims. He combines technical expertise with a strong understanding of economics and finance to support successful outcomes. Adam also contributes to industry webinars and CPD sessions, sharing insights on R&D tax relief and HMRC requirements.