Tax fee protection insurance (TFPI) is an insurance policy or insured service mostly provided by your accountants to protect against the costs of dealing with HMRC enquiries. For a relatively cheap annual premium or fee, a business can get the technical and professional services of their accountant, often up to £100k of fees. The schemes often include many auxiliary services such as business legal, HR and employment law advice for the client.
If so that’s great. However, if your accountant prepares your claim or you do so internally it might be worthwhile having a claim health check. It’s common for companies to work with a specialist for a few years then prepare claims themselves to save costs, doing so also removes that external guide to question eligibility apportionments or bring up hot topic areas HMRC are focusing on. At a minimum, it can provide peace of mind that your processes and level of information provided to HMRC are sufficient.
We are able to work with businesses on a light touch approach to just guide them every so often. Your car has a MOT every year, so why not give your claim methodology a MOT every few years.
That’s fine, HMRC’s doesn’t require you to do so in their own guidance in CIRD80550 and CIRD80560. There is naturally an expectation that the larger the business the higher the expectation would be on internal record keeping, but for most SME’s who have never claimed before, beyond being able to provide invoice evidence, you are not expected to be able to provide detailed evidence on all of your eligible activities. HMRC would expect this to improve year on year as you become aware of what information is required and what constitutes eligible activities.
The reason is that can’t know everything (neither do we). What we do know, we know well. Dealing with us reduces your risk of litigation for incorrect advice. You may even sleep better not worrying whether the job was done right.
Remember, you will also save time and still earn a fee from your client.
Our lead consultants are fully qualified and members of The Chartered Institute of Taxation (CIOT).
Visit our Meet the team section to get to know our experts better.
We do not advise on or promote any tax avoidance schemes. Tax avoidance schemes are not necessarily illegal, they just don’t work.
We only provide advice of tax incentives or reliefs that are part of statutory UK tax legislation.
Taking advice to ensure you are arranging your affairs in a tax efficient manner and claiming all available tax reliefs is not illegal.
We charge fixed fees that we agree before starting any work. You will be clear from the beginning that there are no unexpected fees.
Remember, good tax advice always pays for itself!
We provide a range of tax advisory services. These range from structuring your business tax efficiently to ensuring you minimise taxes on death.
Accountants have a general overview of tax. They are not experts (we always use the GP and specialist consultant to explain the difference).
Specialists are needed for complex tax planning and transactions.
To ensure you or your business takes full advantage of the tax incentives and reliefs available, you will often require a tax specialist who will have the relevant experience and knowledge of the specific legislation.
If your accountant doesn’t have a TFPI scheme in place or if the scheme they offer doesn’t quite suit your business needs, then you can go to our online portal to purchase this insurance. Full details of the policy coverage are detailed within the policy documents.
Our tax enquiry insurance will cover costs incurred by your accountant defending you in the event of an enquiry into either your business or your own private tax affairs. If you want your own accountant to deal with any HMRC enquiries that is your prerogative, but if you prefer, it can be set up to cover costs incurred by the insurers own tax specialists, who have many years’ experience dealing with tax enquiries and will ensure you have the best possible defence and get the right outcome.
HMRC will write to you and/ or come and visit your business premises and ask you questions about how you have determined the amount of tax due. It is important that you have professional representation to ensure that HMRC’s questions are answered robustly and accurately. Enquiries can last for months or even years and professional fees incurred dealing with the enquiry can amount to thousands of pounds, even when no additional tax is due at the end of the enquiry.
Standard exclusions for all insurers are:
• Accounting fees for statutory work, including completing tax returns, VAT returns, compilation of accounts or reconstruction of records
• Deliberate omissions on a tax return, tax avoidance schemes, fines penalties and duties
There are some additional instances not covered by certain insurers. It is best to have an expert review the scheme/ policy for an accurate assessment of cover.
Professional fees to respond to HMRC enquiries, compliance checks and any number of specific enquiries under several HMRC notices are covered. For example, full and aspect enquiries for both corporation and income tax, intervention notices, VAT inspections and disputes, employer compliance, PAYE and NIC enquiries.
Some insurers also cover CIS, inheritance tax, stamp duty and several other specific areas, whereas some exclude these. Cover values also vary between insurers, and some have inner limits and/ or excesses applied to certain claims groups. It is always best to have a TFPI expert review the cover – the devil is in the small print.
These types of insurances normally only cover the lawyer’s costs of representing you in court, not your accountant’s costs. The aim is to stop or restrict HMRC without having to go to court. They are also often capped at lower levels outside of legal costs that will leave you with amounts due. They may also have large excesses. TFPI also allows the accountant to use extra technical resources to protect you.
More than half of HMRC’s enquiries or investigations are dropped, with very little or no tax repercussions. It is part of HMRC’s control mechanisms to ensure tax compliance.
HMRC inspectors often pursue a line of enquiry based on its understanding of a certain tax law, only for it to be proven incorrect or not applicable to that specific taxpayer. Anyone can be investigated. Remember, it’s the taxpayer who is liable for additional taxes resulting from enquiries, even if the accountant completed the tax return.
HMRC regularly reviews taxpayers, irrespective of their status. Anyone can be subjected to an enquiry. It is part of HMRC’s control mechanisms to ensure tax compliance. However, the cost of professional services by your accountant in ensuring HMRC don’t pressure the taxpayer into paying over the odds is a factor, and the accountant’s fees are still to be paid.
Sometimes, the costs of protecting your tax affairs exceeds the potential tax liability. TFPI ensures you are protected from such costs. Government grants and furlough schemes caused by Covid-19 mean HMRC is likely to be extra attentive in tax collections. Enquiries and investigations are part of the accepted compliance regime.
No. We can also file amended tax returns, will act as your R&D agent to HMRC (which will not affect your accountant’s position as HMRC agent) and handle any enquiry in the event you receive one.
We can also work with you to put processes in place to gather information in real time and improve the efficiency of future claims.
We generally work on a contingent basis and don’t invoice until you have received payment from HMRC or confirmation of a reduced corporation tax bill.
We always agree our fees upfront, so there are no unexpected bills.
All sectors and industries can qualify for the relief. While activities in humanities, social sciences and the arts are specifically excluded, companies in these industries can still makes claims for things like software they have developed. They may also claim for something outside their core trade.
Yes. But, if you have already started a claim process with another provider, they may charge a fee to cover the work they have completed to date. If you are preparing a claim yourself and feel you need assistance, then we can help you.
Yes; though some advisors tie companies into long contracts. However, most have break clauses or would not go as far as to force you to work them if you chose to switch.
The claim process can be completed within two weeks. We work around your availability to discuss your projects, provide financial and additional information and review the report.
It may take longer if your company is larger and undertook a significant amount of R&D. Also, scheduling means not everything can be completed in two weeks.
As R&D activities are wide ranging, there is some confusion around ‘research’ and whose R&D a project is. Therefore, a number of areas would not qualify as R&D for a company. The following list is not exhaustive:
• Market research into launching a new product in a geographical location or researching the procurement of a material or product to sell would not qualify as no scientific or technological uncertainty is being overcome
• Asking someone else to build you a website or build something for you where you have provided a brief and fully left the development to them would not qualify as any R&D would be theirs
• Building something on a platform that allowed for functionality that already exists would not qualify. So, researching how to create pivot tables in Excel would not qualify as guidance on this functionality is already freely available on internet platforms
Only limited companies can make R&D tax claims. Individuals cannot and neither can LLPs. However, corporate members of LLPs can claim a proportion of costs incurred within an LLP if the LLP has undertaken qualifying activities.
You can claim for staffing costs, external workers, software and other consumables/ materials. Large companies can also claim for clinical trial volunteers and contributions to individuals or certain research organisations. Click here for further details.
The definition of qualifying R&D activities is broader than many people realise. While the official definition of seeking an advance in a field of science or technology through the resolution of a scientific or technological uncertainty seems quite daunting, it can apply to range of business activities. From developing or improving a software platform or product, to improving the efficiency of a manufacturing process and overcoming challenges caused by environmental restrictions in construction. Eligible R&D activities exist in many aspects of a business. Click here for further details.
As you know, claiming on embedded fixtures is a complex area of tax legislation. This is why qualified surveyors and property tax specialists are needed. Our aim is to support accountants and other business advisors who are unaware of the full extent of their client’s entitlement. We also help those who have looked to claim in the past but found their clients were too small to fit the strict criteria of other firms.
There is very little input required from you. We do all the hard work and you benefit from an improved relationship with your client.
We generally work on a contingency basis with no upfront or hidden costs.
Our fees are often paid out of tax repayments received from HMRC.
Our fees are up to 50 percent less than competitors and we even offer a free property survey as part of our service (usually £1,000+).
Where a property owner meets the criteria of the legislation, they are entitled to claim the tax relief. HM Revenue & Customs is used to dealing with these claims. In the unlikely event of any queries being raised by HMRC, it is part of our service to resolve them. We do not proceed with claims that do not meet the requirements of the relevant tax legislation.
The claim report is submitted to HMRC with your tax return. HMRC has 12 months to enquire into the claim. As the report fully discloses the entitlement to the tax relief and the methodology taken, enquires by HMRC are rare. The disclosure in the report means the risk of penalties are minor.
HMRC cannot raise a discovery assessment if it tries to challenge the claim outside the 12-month enquiry window.
Any legal documentation in the relation to the sale (purchase contract, CPSE, completion statement) if available.
We also need some information from your accountant. For example, a copy of a tax return and accounts.
If the property has been sold within the last two years, there may still be time to make a claim. We recommend you contact us as soon as possible so you don’t miss out on a claim.
We don’t charge any extra costs. If a claim is not successful there will not be a fee.
Not all property owners are entitled to the allowances. We also have a minimum estimated claim value of £30,000 before we would take a client on.
This is not a tax avoidance scheme. We have agreed hundreds of claims with HMRC with 100 percent success rate to date.
Your accountant will claim on everyday purchases such as curtains, carpets and furniture, etc. But, unless a specialist surveyor has analysed the property, you may be missing potentially large capital allowance claims. If a survey for capital allowances has never been undertaken it is highly unlikely that all allowances have been claimed.
The claims we prepare require the skills of both tax and surveying professionals. They are outside the remit of an accountant. Generally, property owners who have claimed capital allowances for fixtures would have received some cash from HMRC, had their tax bills reduced each year and they will have engaged a specialist firm to prepare the claim.
Most accountants will claim capital allowances on qualifying capital purchases, like machinery, equipment and furniture. However, to claim capital allowances on fixtures embedded in a building you need a specialist in tax and surveying.
If you are just renting your property, you will not qualify. If you are a landlord or investor then please get in touch.
Yes. Ex-residential properties now used for business purposes will qualify for a claim. These include B&Bs, holiday lets and care homes, etc.
If a property has recently been purchased and the seller has not made a claim for capital allowances then a claim is possible. Get in touch with us for more information.
It’s still possible to claim capital allowances in a later year’s tax return, as long as you still own the building.
If there is a capital gain on sale of the property, the capital gains base cost remains the same, even if capital allowances have been claimed.
We generally work on a contingent basis and don’t invoice until you have received payment from HMRC or confirmation of a reduced tax liability, so there is no risk to yourself.
All fees are agreed upfront so there are no unexpected bills
The process is very simple and requires little input from you. We will work with your accountants or advisors to ensure this is done quickly and efficiently, with minimum disruption to you or your business.
Once we have established you are entitled to claim, we will undertake the site survey and then complete the claim at our offices. All we would need is for you or somebody with good knowledge of the property to be in attendance when we carry out the survey (1 to 2 hours).
Our team has a wealth of experience in preparing and agreeing claims with HMRC and our methodology and claim reports are in a format that has been agreed with them. This means we can swiftly agree our claims in as little as four weeks. Our process has only five stages [Link]: consultation, validation of the claim, property survey, production of the CAVR (capital allowances valuation report) and approval and submission to HMRC.
What many property owners and their advisors don’t realise is, if a property is used for the purpose of a business, UK tax legislation allows tax relief to be claimed on a proportion of the purchase price that relates to ‘fixtures’ that were acquired with the property. Fixtures include the electrical, heating and ventilation systems, kitchens, bathrooms, carpets, drainage and alarms, etc. These items are more commonly referred to as embedded fixtures.
Property owners are eligible to claim if they are a company, sole trader or partnership and are carrying on a trade or a property letting business (including furnished holiday lets in the UK or European Economic Area).
Becoming an introducer for us is very easy. We just ask you to sign our partnership agreement [link] and then you can begin speaking with your clients about our services and how we can help. Once contact has been made with your client, we do all the rest. We’ll get back in touch to pay your referral fee upon successful completion of the claim.
• Earn fees from your clients or any business contact you refer to us
• Strengthen existing and forge new relationships – your clients will be very grateful for the tax savings
• Reduce litigation for incorrect advice
• Save time
HMRC can only make enquires into the tax year that we submit your claim in. Rest assured, we won’t open a can of worms!
If HMRC does raise an enquiry into any claim we submit, our team will deal with this on your behalf. This will be included in your fee, unless advised otherwise.
Unlike some companies, we are fully accredited tax specialists. Our tax specialists are accredited under the CIOT and are bound by their codes of conduct.
If you’ve already raised your concerns with your dedicated case manager and are not happy with the feedback from them, then you can write to us at Zeal Tax, Client Services Department, 22 Chepstow Road, Newport NP19 8EA or email email@example.com
We are regulated by the Chartered Institute of Taxation (CIOT). It is mandatory that we issue a client with an engagement letter and carry out anti-money laundering checks (AML checks) on all of our clients.
Our engagement letters set out the scope of our services and fee payment terms. Engagement letters are designed to protect you and provide clarity on the work we have been engaged to carry out.
Anti-money laundering (AML) laws provide companies with a set of regulations they must follow to gain compliance. The UK laws are detailed and include protection measures, offences and their respective penalties. As we are dealing with money and finances, we are required to carry out these checks on our clients. The checks are not optional. We usually undertake this process as part of our new client setup.
We are very conscious of the relationships between clients and accountants. We are experienced in managing these relationships.
We have great relationships with accountants and your claim will run more smoothly if we bring them into the process early. As we are tax specialists, the services we provide often sit outside the remit of accountants and is a supplementary service. We often find after working with accountants, they will refer us to other clients.
Yes. We offer a free 30-minute telephone consultation. This is an opportunity to speak with one of our specialist advisors without any obligation to proceed.