Effusive praise has been delivered to the randd team by a highly satisfied client, whom we helped to achieve a successful outcome in an HMRC enquiry into its R&D activity.
Cambridge-based Cantab Predictive Intelligence (Cantab Pi) is a data analytics and artificial intelligence (AI) company which is developing and scaling a data and AI platform for sales, marketing and medical use cases in life sciences.
In December 2022, HMRC opened an enquiry into Cantab Pi’s R&D tax credits claim for 2020-21 and subsequently also for 2021-22, asking questions about the validity of certain aspects of the submission regarding the projects included.
However, Cantab Pi’s AI development is, in the words of randd Director Matt Timby, “bolt-on R&D”. After HMRC agreed to a meeting with our team and Cantab Pi, and we succinctly put across our points, a letter was received containing the magic words “No amendments to make” – which meant outright, 100% success and case closed.
Cantab Pi kept every penny of its claim and could breathe a huge sigh of relief. “It was tough going at times, but we did it,” said Matt Timby.
Dr Sinisa Slijepcevic, Founder and CEO of Cantab Pi, could not be happier with the lengths to which randd went in ensuring his company received the R&D tax credit reimbursement it was due.
“We are still celebrating the end of a 14-month journey,” said Sinisa. “We appreciate the level of support we got from the entire randd team.
“We have been working with randd since our first R&D tax credits claim, which was small, but the claims grew as we continued investing. We expected we would have access to some kind of benefit due to the innovative, highly impactful, high-value R&D work we were doing.
“We learned the details from randd of what it would mean in practice and what we would need to do to get the grant.”
How randd helped Cantab Pi with its HMRC enquiry
Nevertheless, Sinisa was aware a time would probably come when scrutiny was likely from HMRC about Cantab’s R&D activity – and randd’s help was invaluable in addressing those concerns.
“We kind of expected at a certain point we would have to justify what we were doing and we appreciated the challenge,” he explained.
“What was a bit of a surprise was that the entire process was rather unstructured and almost random. It was not clear what was expected or what we needed to do. The
questions were, I would say, administrative and vague and this is why we really appreciated the support we received from randd.
“It was not just about explaining what we had to do but understanding what was being asked, how to manage the entire process and which kind of detail you needed to provide at which point and which kind of questions you needed to answer, even though they hadn’t been asked explicitly.
“For example, there is the phrase ‘competent professional’ and the question ‘Could a competent professional achieve what you have achieved?’ and it has a very specific meaning in this environment. If the answer is ‘yes’, it means it’s not proper R&D because it’s something that can be done almost off the shelf.
“There is another term ‘technological uncertainties’. It’s clear what this means in English, but very unclear what this means to HMRC. What do you need to say? You need to know what they’re talking about. HMRC has its own vocabulary and labels.”
Sinisa gave a further insight into how randd had specifically helped Cantab and the type of expertise we provided.
“The process consisted of two different workstreams. One was communication with HMRC and the other was technical advisory and supporting and coaching us in being able to answer the questions and defend our case,” he said.
“Regarding communication with HMRC, I still don’t understand how this fully works but I’m glad we have a team, in randd, that does. It was about supporting both HMRC and us to find a reasonable solution and save time and I think that is what randd did really well.
“They proposed to the HMRC inspector how we could move forward in terms of exchanging communication in a more effective way. They played a pivotal role in scheduling a meeting at which we were given an opportunity to defend our case, and they really were instrumental in speeding up communication and making things happen, even though it lasted 14 months. I have absolutely no idea how many years it would have lasted without the randd team.
“At the end, we had to meet the inspector and explain clearly why this is proper R&D, why the grant and subsidies are viable. We were fully prepared by randd to answer the questions in a concise, precise and accurate but still simple enough and clear enough way for the inspector to be able to understand and to do her job. This was really appreciated.
“Everyone was trying to do his or her job the best they can and the randd team helped us all achieve that goal.”
Why Cantab Pi would recommend randd
Sinisa has no hesitation in recommending randd as the go-to expert for R&D tax credit claims.
“I would emphasise three things: the first is strong technical knowledge; the second is understanding the process and how HMRC makes decisions; and the third is that randd’s entire process of making a claim and preparing all the paperwork is very efficient,” he said. “Obviously, those three things are related to each other.
“One or two sentences on each: firstly, preparing a claim is not simple and we are in a very specific niche which is complex and technically demanding with lots of buzzwords. Thus, it is important to have a team who can translate the ‘geek’ language, and for this a certain level of technical competence is needed. We appreciate this level of technical competence exists within the randd team.
“The second one, understanding the process, was critical, especially while we were dealing with the HMRC challenge.
“And finally, I can say we really did not need to spend more than a couple of man-days from our end to prepare the claim. It was very efficient and required relatively little of our time for all the paperwork to be ready for submission.
“We got professional help from the randd team – and this means a lot to us.”
