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What’s causing chaos with your R&D clients?

2nd Jun 2022
Brought to you by
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R&D tax relief training and support

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When your clients fall foul of unethical R&D sales tactics, it causes headaches all round. Here's how to protect your clients and mitigate the risk.

A stressed woman receiving a telesales call
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Last week we shared with you 3 horror stories of R&D claims gone wrong. It’s easy for us to sit here and blame unethical R&D consultants for the mess, but that doesn’t solve the problem. The good news is that there are straightforward steps you can take to mitigate it.

Issue 1 – Clients allowing R&D Consultants to send amended tax returns directly to HMRC

Despite you being the registered agent for tax, sometimes the client cuts you out of the loop. If this happens, the first you’re likely to know about it is if you see a refund or rebate showing on your system...or you get a Compliance Check investigating the claim. 

How on earth do you handle this? By the time you find out, it’s too late to give the client advice on their eligibility, and they’re into an expensive damage-limitation exercise which takes time to resolve.

Really the solution here is to pre-emptively profile and then speak to your clients about R&D, so that you can get in ahead of the aggressive telesales calls. This profiling is a straightforward process that we’ve outlined in our recent article How to review your portfolio for R&D tax clients

You’ll find clients in certain industries are more likely to be doing qualifying work, which also means they’re more likely to get those sales calls. Let them know that any R&D claims they prepare should come with a report, and that they shouldn’t allow the consultancy firm to submit the updated tax return instead of you.

Issue 2 – Clients you feel are ineligible are asking you to submit claims prepared by consultants

The other troublesome group are the clients who don’t qualify, but still end up trying to make a claim anyway. Unfortunately, this happens all the time with R&D tax relief. It’s impossible to stop unscrupulous R&D consultants approaching your clients with messages like ‘This is a tax break that every company’s entitled to’ or ‘Any change you make in your business can be counted as R&D’. They often position themselves as champions of small business, ‘getting your company going again’ after the pandemic. It’s not hard to see why some clients fall for it.

If you conduct a portfolio review, you can identify these at-risk clients as well, and you can give them unbiased information about the scheme and what’s eligible, and what isn’t. Then they’ll be far more resistant to the sales calls of R&D consultants who prioritise fees over your clients’ best interests.

Next steps

As you can see, client education is vitally important, as many clients will have very little knowledge of R&D tax relief and may believe that it’s available for any improvement to their business. Explaining the scheme’s criteria clearly and simply will either result in the client starting a claim with you, or if they’re not eligible, will leave them more clued-up when they inevitably get approached by R&D telesales. 

Next week we’ll talk more about how to educate your clients effectively – for now you can get ahead of the game with our easy portfolio review process (and free template!)