Time is short. Clients want everything in a hurry. Every piece of work must earn a fee. When you’re facing these pressures every hour of every day in your tax advisory firm, the last thing on your mind is going to be ‘Start a campaign to change the Treasury’s approach to R&D tax credits...’
But that’s exactly what we did. In 2020, Confluence Tax lobbied against the R&D tax credit PAYE cap, as a highly damaging measure for UK life science companies, given their low headcount and need to carry out large amounts of R&D outsourcing. We conducted a quick poll of clients that resulted in more than 40 messages of support obtained within 24 hours, which were incorporated as evidence in the challenge letter sent to HMRC. This campaign resulted in HMRC granting an exemption to the PAYE cap, which our firm was also involved in designing.
So why do we think that lobbying is something that more firms should consider, especially those operating in niche specialisms?
First, it is inherently the right thing to do, especially if you care about the industry that supports your livelihood (in our case, life sciences and the knowledge economy). Our route into lobbying was helped by membership of the BioIndustry Association, the trade association for innovative companies in life sciences. Our sector is full of passionate, knowledgeable, motivated people who want to make a difference; but so are most industries so that’s not unique to us. Nobody wants to see injustice, whether that’s in the amount of tax paid or saved, or anything else. So there’s your first reason: be your clients’ number one fan and show you care.
Second, being able to present your proposed tax change, or challenge to a government-initiated change, to HMRC or HM Treasury, and then get the opportunity to discuss it with them, is enormously satisfying. And if the government takes it on board, you’ve really earned that warm and fuzzy feeling! So it’s intellectually interesting too and enhances your day job.
In turn, becoming a government ‘influencer’, builds a good reputation for your firm within these circles, meaning you are asked to contribute to more tax reviews, Treasury conversations, and ultimately, to advise directly on the tax matters that the creators of UK tax law are working on. This credibility enables you to talk with real insight to existing and prospective clients. In case of any doubt, the motivation is never personal or egotistical; it is for the common good of clients and in support of getting a fair deal for small companies.
While not the main reason why our firm challenges the government on tax legislation, the spillover benefit in the form of marketing and promotion of your company’s brand, is very worthwhile. There is a reason why ‘thought leadership’ has become the marketing focus for so many individuals and companies in recent years: it speaks for itself and doesn’t involve endless soul-destroying lead generation activities and ROI calculations. When your firm engages with putting views ‘out there’, you are generating your own marketing content, which is an excellent place to start if you want to differentiate your company from all the other professional services firms operating within your sphere.
Marketing has not traditionally been high on accountants’ to-do lists, but your campaigns can be incorporated into your website content, social media feeds, and even press releases or client newsletters. In this way, you are generating all-important ‘calls to action’ by asking your clients’ for their views, so that you can put these forward to the relevant departments and effect positive change on their behalf. Any excuse to get in touch with clients is a good excuse and increases their awareness of what you can do as a firm. Campaigning builds respect, trust and loyalty among your clients, sending the message that your brand is the one to choose over the others.
Tax campaigning requires confidence and a good knowledge of the UK tax system and how this relates to your specific sector or clients. Negotiating with the government and finding solutions means you need to be able to understand other stakeholders’ points of view, which of course may be different from yours.
Understanding the motivations of the various government departments involved is key to a successful outcome for your challenge. HMRC is rightly obsessed with abuse by taxpayers, and the Treasury is trying to find the right outcomes for the country to drive behaviour. If HM Treasury’s perception is that making this change will mean less tax collected and no behaviour change being made (it calls this ‘deadweight cost’), the suggested changes are unlikely to fly. And of course there is the possibility you will not succeed, but your clients will appreciate that you at least tried.
In our firm, we use the various government consultations on tax matters as talking points for team meetings, discussions with clients, and opportunities to dive in and try to make improvements to UK tax law. These group discussions keep the team sharp and ensure you keep your own tax knowledge up to date, further helping clients by being ahead of the game – and at times, ahead of the government too.
Yes it’s hard work, and yes it’s time consuming, but your clients will love you for it and the satisfaction when you see the change come into force is unrivalled.
Time is short. Clients want everything in a hurry. Every piece of work must earn a fee. When you’re facing these pressures every hour of every day in your tax advisory firm, the last thing on your mind is going to be ‘Start a campaign to change the Treasury’s approach to R&D tax credits...’
But that’s exactly what we did. In 2020, Confluence Tax lobbied against the R&D tax credit PAYE cap, as a highly damaging measure for UK life science companies, given their low headcount and need to carry out large amounts of R&D outsourcing. We conducted a quick poll of clients that resulted in more than 40 messages of support obtained within 24 hours, which were incorporated as evidence in the challenge letter sent to HMRC. This campaign resulted in HMRC granting an exemption to the PAYE cap, which our firm was also involved in designing.
So why do we think that lobbying is something that more firms should consider, especially those operating in niche specialisms?
First, it is inherently the right thing to do, especially if you care about the industry that supports your livelihood (in our case, life sciences and the knowledge economy). Our route into lobbying was helped by membership of the BioIndustry Association, the trade association for innovative companies in life sciences. Our sector is full of passionate, knowledgeable, motivated people who want to make a difference; but so are most industries so that’s not unique to us. Nobody wants to see injustice, whether that’s in the amount of tax paid or saved, or anything else. So there’s your first reason: be your clients’ number one fan and show you care.
Second, being able to present your proposed tax change, or challenge to a government-initiated change, to HMRC or HM Treasury, and then get the opportunity to discuss it with them, is enormously satisfying. And if the government takes it on board, you’ve really earned that warm and fuzzy feeling! So it’s intellectually interesting too and enhances your day job.
In turn, becoming a government ‘influencer’, builds a good reputation for your firm within these circles, meaning you are asked to contribute to more tax reviews, Treasury conversations, and ultimately, to advise directly on the tax matters that the creators of UK tax law are working on. This credibility enables you to talk with real insight to existing and prospective clients. In case of any doubt, the motivation is never personal or egotistical; it is for the common good of clients and in support of getting a fair deal for small companies.
While not the main reason why our firm challenges the government on tax legislation, the spillover benefit in the form of marketing and promotion of your company’s brand, is very worthwhile. There is a reason why ‘thought leadership’ has become the marketing focus for so many individuals and companies in recent years: it speaks for itself and doesn’t involve endless soul-destroying lead generation activities and ROI calculations. When your firm engages with putting views ‘out there’, you are generating your own marketing content, which is an excellent place to start if you want to differentiate your company from all the other professional services firms operating within your sphere.
Marketing has not traditionally been high on accountants’ to-do lists, but your campaigns can be incorporated into your website content, social media feeds, and even press releases or client newsletters. In this way, you are generating all-important ‘calls to action’ by asking your clients’ for their views, so that you can put these forward to the relevant departments and effect positive change on their behalf. Any excuse to get in touch with clients is a good excuse and increases their awareness of what you can do as a firm. Campaigning builds respect, trust and loyalty among your clients, sending the message that your brand is the one to choose over the others.
Tax campaigning requires confidence and a good knowledge of the UK tax system and how this relates to your specific sector or clients. Negotiating with the government and finding solutions means you need to be able to understand other stakeholders’ points of view, which of course may be different from yours.
Understanding the motivations of the various government departments involved is key to a successful outcome for your challenge. HMRC is rightly obsessed with abuse by taxpayers, and the Treasury is trying to find the right outcomes for the country to drive behaviour. If HM Treasury’s perception is that making this change will mean less tax collected and no behaviour change being made (it calls this ‘deadweight cost’), the suggested changes are unlikely to fly. And of course there is the possibility you will not succeed, but your clients will appreciate that you at least tried.
In our firm, we use the various government consultations on tax matters as talking points for team meetings, discussions with clients, and opportunities to dive in and try to make improvements to UK tax law. These group discussions keep the team sharp and ensure you keep your own tax knowledge up to date, further helping clients by being ahead of the game – and at times, ahead of the government too.
Yes it’s hard work, and yes it’s time consuming, but your clients will love you for it and the satisfaction when you see the change come into force is unrivalled.
.jpg?sfvrsn=335a554c_0 "300 x 250 (MPU)")