We Sounded the Alarm 4 Years Ago!
Many will have seen the recent turbulence in the R&D tax sector. The Times articles which ran at the start of November revealed large-scale misuse of the scheme, with losses to fraudsters and erroneous claims hitting at least £469 million last year alone, according to HM Revenue & Customs.
In early November 2022, a Finance Bill sub-committee hearing shone further light on the abuse of the scheme. Lord Turnbull, a cross bench peer and former cabinet secretary 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.”
Over the last two years, the growing discontent amongst many credible advisers has produced countless articles, blog posts and social media commentary. Complaints of incredulous claims, inflated tax credits and poor adviser conduct have been widespread. It’s now patently clear that HMRC and The Treasury share the concerns that many in the sector have held for some time.
However, the problems are not just a recent trend. The YesTax website was written in late 2018 and we made the effort of distinguishing ourselves from the poor adviser conduct which, although existed at the time, wasn’t as widely acknowledged as it is today.
Our ‘what we say no to’ page, written in 2018, includes the following statements:
- Over the years, we’ve seen the advisory market change dramatically. A number of trends have appeared in recent years, many of which we don’t agree with.
- We don’t feel the need to cold call thousands of businesses across the UK. We don’t win business by employing third party sales companies to call thousands of UK businesses.
- No firm can offer 100% success guaranteed. Many R&D claims are complex and involve (in certain areas) a degree of subjectivity. Can success be 100% guaranteed? No. We’d rather be honest than use false claims in our marketing.
- We don’t have people who know very little about how R&D tax relief works who will inflate the potential benefits simply to gain a sales commission.
- It’s therefore clear that many advisers, YesTax included, had spotted the problems long before the abuse of the scheme became widespread public knowledge.
- We support the additional scrutiny of claims and welcome any further changes which will assist in eradicating the fraudulent behaviour which has tainted the market for so long.
YesTax. Positively Better.