As R&D incentives become a strategic funding line rather than a year end bonus, many CFOs are asking whether a generalist tax firm is still enough. This article explores when a specialist R&D tax advisor becomes essential, and how sector specific insight can materially change outcomes.

Why R&D tax is no longer a niche afterthought

For many years, R&D incentives were treated as a technical area handled quietly by the tax team. Today, the landscape is different:

• R&D tax relief can represent a material percentage of total innovation spend.
• Governments are tightening definitions, documentation rules and enquiry practices.
• Boards and investors increasingly ask whether benefits are sustainable and defensible.

In this environment, R&D support is no longer simply a computation on a tax return. It touches strategy, governance, risk and capital allocation. That is where the distinction between a generalist adviser and a specialist R&D tax advisor becomes critical.

What a specialist R&D tax advisor actually does

A specialist adviser focuses on the intersection of tax law, technology and funding. In practice this means:

• Translating technical work by engineers, scientists and software teams into qualifying R&D projects.
• Designing robust methodologies for apportioning costs and staff time.
• Building evidence frameworks that align with tax authority guidance and enquiry trends.
• Coordinating R&D tax relief, grant funding and other incentives such as IP regimes.
• Supporting audits and enquiries with clear narratives and documentation.

Rather than appearing once a year for a claim calculation, a strong R&D specialist engages with product, engineering and finance teams throughout the project lifecycle.

Where generic advisers typically fall short

Generalist tax advisers can certainly file claims and stay broadly within the rules. The friction comes when complexity increases. Common weaknesses include:

• Shallow technical understanding
  Difficulties explaining genuine technological or scientific uncertainty, particularly in software, AI, life sciences and advanced engineering.
• Overly narrow or overly broad project scoping
  Missing eligible work because it does not fit simple templates, or including marginal activity that increases enquiry risk.
• Limited integration with grants and subsidies
  Overlooking interactions between R&D tax relief and grant funding, which can lead to clawbacks or under utilising available support.
• Weak evidence frameworks
  Reliance on spreadsheets and interviews rather than integrating with existing systems such as ERP, timesheets or development tools.
• Reactive approach to policy change
  Updating clients only after reforms take effect, rather than helping CFOs plan for future rule changes.

When regimes become more stringent, these weaknesses move from inconvenient to risky.

When specialism really matters: three sector examples

1. Software and AI

A scaling software group may have several hundred developers working across product lines, infrastructure, data and maintenance. A generic adviser may categorise most work as either maintenance or development and apply simple ratios.

A specialist R&D tax advisor will:

• Work with engineering leadership to map specific streams where technological uncertainty exists.
• Distinguish genuine algorithmic or architectural advances from routine feature development.
• Align evidence with tools such as Jira, Azure DevOps or Git, rather than relying solely on retrospective estimates.

The result is typically fewer but better documented projects, a clearer narrative for tax authorities and a more sustainable benefit profile.

2. Life sciences and medtech

In life sciences, timelines are long, regulatory pathways are complex and collaborations with universities or hospitals are common. A generalist firm may struggle to navigate:

• Clinical trial phases and the distinction between research and commercial activities.
• Cost sharing arrangements with partners and funding bodies.
• Interactions between grant funding and tax incentives.

By contrast, a sector focused R&D adviser is likely to have experience with similar studies, can interpret protocols and regulatory documents, and is familiar with typical funding structures. This can reduce errors in cost allocation and avoid misunderstandings on eligibility where patient safety, regulatory oversight and public funding intersect.

3. Advanced manufacturing and industrial R&D

Advanced manufacturing projects often involve incremental innovation on production lines, adoption of new materials, digital twins or automation. The challenge for a generalist is distinguishing routine optimisation from qualifying technological advances.

A specialist adviser will:

• Spend time on site with process engineers and production managers.
• Identify where there is genuine uncertainty in scaling or integrating new processes.
• Separate commercial trials and customer specific configuration from core experimental work.

In many cases, this re framing turns apparently minor activities into eligible projects with significant qualifying expenditure, supported by robust plant data and process metrics.

FI Group insight on specialist R&D advisory

Consultancy FI Group notes that many companies only consider moving from a generic adviser to a specialist R&D tax advisor after an enquiry, a disappointing claim outcome or a change in ownership. Their experience suggests that earlier engagement can prevent problems and uncover additional value.

Working across software, life sciences and advanced manufacturing, FI Group focuses on aligning R&D incentives with real world engineering and scientific work. This involves building project taxonomies that reflect how teams actually operate, integrating evidence collection into existing systems, and mapping R&D tax relief alongside grant funding and other innovation incentives.

Because FI Group operates in multiple jurisdictions, their teams also help multinationals avoid inconsistent positions between countries and manage the combined effect of tax and non tax funding. Many CFOs and Heads of Tax use funding advisers’ guidance from FI Group as a benchmark when assessing whether their current arrangements are still fit for purpose.

How CFOs can evaluate their current R&D approach

For a finance leader, the question is not whether the current adviser is competent. It is whether the model is still appropriate given the scale, complexity and risk profile of the business. Useful tests include:

• Materiality
  Are R&D incentives now large enough to affect earnings, valuation or debt covenants? If yes, specialist scrutiny is warranted.
• Complexity
  Has the business diversified into new technologies, jurisdictions or regulated sectors where generic templates struggle?
• Evidence and enquiry readiness
  Could the organisation credibly respond to a detailed enquiry without scrambling for data or recreating narratives from memory?
• Integration with wider funding
  Are R&D tax relief claims considered alongside grants, green subsidies and IP regimes, or are they handled in isolation?
• Board and audit expectations
  Do boards and auditors increasingly ask about governance, risk appetite and the sustainability of benefit levels?

If the answer to several of these questions is yes, the case for involving a specialist R&D tax advisor becomes compelling.

FAQs: choosing between a specialist R&D tax advisor and a generic adviser

When is a generic tax adviser usually sufficient for R&D claims?

For smaller, relatively simple businesses with limited qualifying projects and straightforward technology, a generalist adviser may be adequate, provided they take a cautious approach and follow current guidance.

What signals that a specialist R&D tax advisor is needed?

Growing claim values, entry into regulated or highly technical sectors, increased enquiry activity, complex funding mixes or international operations are all signals that specialist support is likely to add value and reduce risk.

Does moving to a specialist adviser always increase the claim size?

Not necessarily. A specialist may reduce headline values in some areas while strengthening the evidence base and governance. The real benefit is a sustainable, defensible position that reflects genuine innovation activity.

How should CFOs compare potential R&D advisers?

Beyond fees, look at sector experience, enquiry track record, integration with grant funding and other incentives, data and systems capabilities, and their ability to brief boards and auditors in clear, non technical language.

Can a business combine an in house team with an external R&D specialist?

Yes. Many organisations retain internal tax or incentives staff to manage day to day processes, and use external specialists for methodology design, complex projects, cross border issues and regular health checks on claims and documentation.