The two models, and what each rewards
Contingent (percentage) fees. The adviser takes a percentage of the relief obtained. The attraction is obvious: nothing to pay if there is no claim. The structural issue is equally obvious: the adviser’s income rises with the size of the claim, so every judgement call about what qualifies carries a financial pull in one direction. Professional bodies permit contingent fees within rules, and plenty of reputable firms use them with proper safeguards. But the model is also what powered the worst end of this market, and HMRC’s own warnings single out agents offering speculative claims in return for high commission.
Fixed fees. A price agreed up front, independent of the outcome. The discipline runs the other way: the adviser has no financial stake in the claim being bigger, and the client knows the cost before committing. The trade-off is that a fee is payable for the work even where the honest outcome is a smaller claim than hoped.
There are hybrids, caps, collars and minimums across the market. Whatever the label, the question that matters is the same: does anything about this fee change what the adviser will say qualifies?
What actually drives the cost
The size of a claim is a poor guide to the work in it. What takes time, and therefore fee, is:
- The technical case. Interviewing the competent professionals, drawing the R&D boundary within commercial projects, and writing narratives that would stand up in an enquiry.
- The boundary rules. Contracted-out R&D, overseas restrictions, grants, connected companies, the intensity test, the cap. Each engaged rule adds real analysis.
- The state of the records. Clean timesheets and project logs make cost work quick. Reconstructing apportionments from memory does not.
- First-time setup. First claims carry the claim notification question, the AIF learning curve and baseline-setting that later years reuse.
A quote should follow those drivers. Be wary of pricing that follows the expected refund instead.
How we charge
A fixed fee, agreed before any work begins, based on the scope drivers above. The fee covers preparing and submitting the claim: the technical narrative, the qualifying-cost analysis, the Additional Information Form and the Corporation Tax return entries, prepared by the team and reviewed by a chartered tax adviser. What each engagement includes, and what it does not, is set out on our services and fees.
If HMRC opens an enquiry after submission, that work is not included in the fixed fee and is handled separately. We would rather say that plainly here than imply enquiry defence is bundled free into every fee, which is how parts of this market oversell.
If we do not think there is a claim, we say so at the outset and no fee arises. And a company can always prepare and submit its own claim without an adviser; the honest guide to that decision is do you need an adviser at all.
Questions to ask about any fee, including ours
- What exactly does the fee include, and is enquiry support inside or outside it?
- Who reviews the claim, and are they professionally qualified and named to HMRC as agent?
- If the honest answer is a smaller claim, or no claim, what happens to the fee?
- Is there any charge contingent on the amount of relief?
- What records will you need from us, and what happens if we cannot produce them?
Any adviser comfortable with those questions in writing is probably safe to talk to. Any who is not has answered them anyway.
Frequently asked questions
Is a percentage-of-claim fee wrong?
Not inherently, and professional rules allow contingent fees in defined circumstances. The question to ask is what the model rewards. A fee that grows with the claim rewards a bigger claim; whether that pressure is managed well varies by firm, so ask how qualifying judgements are kept independent of the fee.
Why do you charge a fixed fee?
So the fee is settled before the numbers are, and the advice on what qualifies is not connected to what we earn. It also means you know the cost before committing, whatever the claim turns out to be worth.
What does your fixed fee include?
Preparing and submitting the claim: the technical narrative, the cost work, the Additional Information Form and the return entries. HMRC enquiry work is not included; if a check arrives after submission, that is handled as a separate matter.
Can we avoid fees entirely?
Yes, by preparing the claim yourself, which a company is fully entitled to do. Whether that is sensible for you is a real question, answered honestly on our "do you need an adviser" page.