Can you tell us about your background and areas of expertise?
I am a specialist in advising family and owner managed businesses on business and corporate tax issues across the business life cycle. My main areas of focus include corporate reorganisations & reconstructions, R&D tax reliefs, employee share incentives, property tax and tax efficient succession planning.
Having qualified as a Chartered Tax Adviser with a large national tax consultancy, my experience includes working for the Big Four (PwC and Ernst & Young), Top 10 (Azets) as well as independent firms. I am currently an Associate Director at ETC Tax, where I partner with accountancy firms and other professional advisers to provide their clients with specialist tax advisory services.
How long have you been in this area and how has it changed?
Having started my career as a graduate trainee in audit, I particularly enjoyed studying tax as part of my professional exams, hence the decision to specialise in tax which was a decision I made over a decade ago and have not regretted it since!
I have seen the tax landscape as well as the role of a tax adviser change significantly over the last decade or so. When I began my career in tax, it was all about having a depth of knowledge of the tax legislation. Today, having detailed knowledge of the tax legislation and being up to date with the rules is only one hat which a tax advisor is expected to wear.
With information now more readily available than ever, tax advisors need to have a more diverse skill set and should ensure that they are not merely seen as encyclopaedia of tax knowledge but to also ensure that any tax advice given to clients is in line with their long-term commercial objectives and strategic planning.
With the tax code becoming more complex by the day, staying on top of change is the greatest challenge faced by tax professionals. Whilst having its challenges, it presents a vast amount of rewarding opportunities to tax advisers to provide a value adding service to clients.
You are currently updating Bloomsbury’s Taxation of Intellectual Property publication. What are some of the recent trends and updates in this area?
The R&D tax relief regime is under immense scrutiny at present. The Chancellor, as part of the Spring Statement in March 2022, stated that the abuse of the SME R&D tax relief is now being specifically cited as a drain on the Exchequer and so there remains the possibility of a shake up in the regime.
In November 2021, the government published a report on the R&D tax relief regime which set out specific details on the proposed changes to the R&D tax relief rules, together with the results of research it carried out in respect of companies’ decision-making processes when preparing R&D tax relief claims. This followed a wide-ranging review of R&D tax reliefs announced at Spring Budget 2021, which was supported by a consultation requesting views on the R&D regime as it currently stands.
The landscape of R&D tax reliefs is expected to change significantly from 1 April 2023, as a number of changes are going to be introduced. These aim to modernise the regime by extending the relief to cloud computing costs, to refocus the incentives on UK based R&D and to improve compliance by deterring fraud and errors.
Whilst the proposed changes will affect businesses in positive ways, it could also mean significant reductions in R&D tax credits which companies might have previously received. Overall, the government’s focus towards tackling abuse of the regime is welcoming.
The government still has an ambitious target to raise total investment in research and development in the UK. R&D tax reliefs pay an important role in incentivising this investment by providing generous tax reliefs to companies undertaking qualifying R&D. It is therefore important to ensure that the reliefs remain up-to-date and well targeted.
Any recent legislation that advisors need to be aware of to pass on to clients?
With the generous super-deduction set to end in April 2023, the Government is considering reforms to best support future investment and ways to provide tax relief for future business investment. An announcement will be made in the Autumn 2022 Budget. Some possibilities of potential reliefs include introducing an additional first year allowance, increasing the permanent level of the Annual Investment Allowance, or increasing writing-down allowances for general plant and machinery.
With the number of reliefs and allowances currently in excess of 1,000, the Government is considering reforming and simplifying the tax system, with further reviews and announcements expected to be made by 2024. With the corporation tax rate set to increase to 25% from 1 April 2023, companies will be keen to ensure that they are taking advantage of available business reliefs and it is more important than ever for advisors to ensure that they are up to date with the constant changes to the various reliefs, such as the R&D regime, the Patent Box rules and any changes introduced to the capital allowances regime this year.