End of Year Review - October to December 2022
In our last review we head towards the close of the year, and what a year it has been. The last quarter was perhaps less turbulent for tax relief changes compared to the rest of the year, but it was certainly not entirely devoid of change, and we had a pretty big change to announce ourselves.
October
We began the last quarter of 2022 looking into the details of the Patent Box tax relief scheme, a much underclaimed tax relief that has been around for almost 10 years but rarely gets discussed in any depth.
October brought with it the reality that there was less than 6 months left until the end of the Super Deduction. With that in mind we produced a quick guide to optimising your claim to make the most of the relief available.
In House of Lords the Finance Bill Sub-Committee launched an inquiry to examine the new R&D tax fraud and abuse rules (a subject we have talked about much over the years), and their effectiveness. Meanwhile, over in the other house, there was a U-turn on the corporation tax rate. We looked at what this meant for Capital Allowances, R&D tax relief and Patent Box claims.
We shone the spotlight on YesTax’s Alison who is the unstoppable driving force behind our Guiding Light charity. Alison told us a little more how her travels lead her to a meeting with Binitia at a Nepalese safe house for vulnerable children.
And at the end of October we proudly announced that we transitioned the company into an employee owned organisation via the Employee Ownership Trust. The move helps secure YesTax’s future, as well as our ethos, values and employees, whilst also rooting the business locally in Sheffield for the longer term.
“When YesTax was incorporated it was underpinned by its 4E philosophy: Expertise, Ethics, Ease, and Engagement. By becoming employee owned, we have added a 5th ‘E’ and in the process have become a genuinely unique business within the tax advisory sector. Building a business and passing it to the staff who have worked so hard to ensure its success is immensely satisfying.”
YesTax Director, John Moxon
November
In early November, a Finance Bill sub-committee hearing shone further light on the abuse of the R&D tax relief scheme. Lord Turnbull told the House of Lords “This is a major financial scandal. The growth in payouts while the economy has been basically stagnant is completely implausible. What we have is a system which is basically, help yourself and . . . the Inland Revenue ticks the claim through.” This is something that we at YesTax were all too familiar with, having written about poor advisor conduct within the industry way back in 2018.
In light of the Treasury’s acknowledgment of the grave issues with R&D tax relief claims, YesTax launched a claim review service for accountants or clients who had prepared their own claims.
On a far brighter side of tax relief, we expressed that whilst there is further scrutiny of claims, at the same time it has never been a better time to submit a R&D Tax Relief claim. And in addition, Capital Allowances were now more valuable than at any point in the last decade.
November’s sector spotlight focussed in on research and development programmes within the software and IT industry, and how the Treasury had recognised that the definition of qualifying software expenditure required updating and broadening for R&D tax relief claims from this highly important sector.
Doing good is a fundamental duty of modern corporate life, and we were proud to report that, as of the end of October 2022, we had achieved donations of over £200,000 to vulnerable children around the world.
We firmly believe that no company is too small to make a difference and that taking moral responsibility for the improvement of the world we live in is an infectious quality. The benefits of a “Business for Good” model are now clearer than ever, with those who adopt such an ethos seeing wide ranging benefits for their own people, their communities, the wider world, and the business’s own upward progression. We believe that YesTax’s own success is testament of this, and by way of practicing what we preach, as November came to a close, we announced our support for Cavendish Cancer Care, who provide individually-tailored support, through art therapy, play therapy and counselling, to children and young people affected by cancer.
December
The final month of 2022 was now upon us. In and amongst our look back at the year we began a new initiative of picking up on some of the questions we get asked more frequently and bringing our answers to the fore for any and everyone who may have had similar queries. For the first of these, we discussed what the tax relief rule changes were for Overseas R&D.
We talked about the Super Deduction coming to an end back in October. With the months continuing to count down, we again looked at this relief scheme with a particular focus on companies with December accounting year ends.
As we have done many times before for others, we took the opportunity to catapult some quick-fire questions at the newest member of the YesTax family, Imogen, uncovering everything from her fear of belly buttons, to love of Bali and frozen strawberry daiquiris.
Closing the year the team took time out to do a little Christmas shopping. Working hand-in-hand with South Yorkshire’s Social Services and Arbourthorne Community Primary School, we purchased a range of gifts for children from less privileged backgrounds within the local area.
It’s truly shocking that, according to figures from the Department for Work and Pensions, 1 in 3 children in South Yorkshire are living in poverty. We hope that our small Christmas gifts contribution will help to bring back a little joy for those children who have found themselves caught at the wrong end of this horrible statistic.
"I wanted to express my sincere and grateful thanks to you for your very generous donation to help us get every child in school a Christmas gift. It’s seriously never been as bad in all my 15 years at the school. This will help bring real happiness and excitement for the children and their parents.”
Vanessa, Head Teacher, Arbourthorne School in Sheffield
And with that, all remains is to wish everyone a very Merry Christmas and a happy and healthy 2023.
Very best wishes from us all at YesTax.
YesTax. Positively having the most wonderful Christmas time.