HMRC extends hands-on support to medium-sized companies

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HMRC launched its ‘Growth Support Service’ on Wednesday, expanding the hands-on support enjoyed by multinationals to encompass medium-sized businesses.

This new HMRC initiative is only open to businesses with an annual turnover of at least £10m, or who have at least 20 employees.

An HMRC spokesperson confirmed to AccountingWEB that businesses need only satisfy either of the minimum criteria, so your clients may qualify on the basis of employee numbers alone. The tax authority also clarified that the employee measurement is based solely on headcount, meaning that part-time workers count towards satisfying the requirement.

What is the Growth Support Service, exactly?

At first glance, the service looks like a streamlined or ‘lite’ version of HMRC’s existing large business guidance. Indeed, HMRC’s direct relationship with corporates has been a sore spot in the past, with the tax authority accused of favouritism towards big business.

Upon closer inspection, you’ll notice the Growth Support Service is split into two streams. On the simpler side, a newly formed “mid-size business customer engagement team” will act as a catch-all to help any qualifying businesses with complex tax questions.

Beyond that, mid-size businesses experiencing “certain types of growth” will unlock more direct attention.

In particular, growing medium-sized firms will have a dedicated tax specialist appointed to them. This individual will help with understanding tax issues and reporting, governance risks, access to incentives and reliefs and will also act as a gatekeeper to other HMRC specialists.

“Certain types of growth” is a rather broad category, it seems. HMRC defines the following relevant types of growth that would qualify a business for its direct support:

  • Significant increase in turnover: “Turnover increased by 20% or more in the last 12 months, where this increase is at least £1m.”
  • Growth related mergers and acquisitions: “Combining with, or buying, companies or other business organisations, or their operating units, resulting in growth of the business.”
  • Group reorganisation: “Reordering or changing the composition of a group of companies for the purpose of business growth [excludes insolvency].”
  • Stock market listing
  • Significant introduction of capital: “...increases the balance sheet total by more than 20% where that capital is at least £1m.”
  • Notifying HMRC and submitting Senior Accounting Officer (SAO) certificate for the first time
  • Making quarterly instalment payments for the first time
  • Entering the VAT Payments on Account (POA) regime
  • Exporting goods or services for the first time, or establishing a presence in a new territory

HMRC also lists “Other significant business growth”, saying it would consider companies for the service that are growing in meaningful way beyond its pre-defined parameters.

The tax authority’s focus on growth and growing businesses would seem to come directly from the top. The government has openly expressed its desire to make growth a simpler goal for British companies.

What do you make of HMRC’s new service? Tell us below.

 

About Francois Badenhorst

I'm AccountingWEB's business editor. Feel free to get in touch with comments, tips, scoops or irreverent banter. 

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21st Sep 2017 14:54

What on earth does HMRC know about growing businesses?

It defies belief that the Government can believe (or be conned into believing by HMRC "Sir Humphreys") that they have the expertise to help businesses of this nature.

As we accountants know a reasonable amount about the "capabilities" of HMRC we know how ridiculous this initiative is.

The worrying thing for me we have initiatives like this in the NHS and other government departments and they are equally likely to be totally useless.

Stick to your knitting HMRC and get your own house in order before having the arrogance to advise others.

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22nd Sep 2017 10:04

PMLOL. You can't make this up can you?

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22nd Sep 2017 10:18

The aim is obviously to ensure the growing business does so in such a way as to generate higher levels of tax since most sensible large companies will seek help from firms like mine to structure themselves to pay less tax (fairly easy to do) or even no tax at all (still not that difficult)

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22nd Sep 2017 11:29

HMRC to become trusted business advisors.

Hilarious!

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By gordo
25th Sep 2017 13:36

Since no Civil Servant has any experience or expertise in growing a business and given that HMRC's published objectives are now to maximise IT'S revenue, is this really just an Enquiry without triggering the Enquiry Window, so that HMRC can maximise the tax paid. (otherwise known in HMRC's speak as helping you get it right first time)
https://www.gov.uk/government/organisations/hm-revenue-customs/about#pri...

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