From R&D to Capital Allowances: Spotting the New Wave of Overnight ‘Experts’
Following on from our recent article on how to pick a Good Capital Allowances Advisor, we have seen a concerning trend: many non-specialist individuals and firms that once claimed expertise in R&D tax relief and credits suddenly rebranding themselves as capital allowances advisors.
In some cases, providers’ websites have been completely overhauled, shifting from promoting R&D services to focusing solely on capital allowances overnight.
The hallmarks of these types of providers are:
No firm regulation or accreditation
No team page at all, or a team with no capital allowances experience or surveying, accounting, or tax qualifications
Reference to ‘Embedded Capital Allowances’ (which don’t actually exist)
It is common knowledge that abuse of the R&D regime has led to tightening up of the market with new administrative hurdles and burdens introduced to tackle bad actors. Whilst stamping out bad practices is an objectively good thing, this has led to several negative outcomes as a byproduct of the new rules.
Firstly, more and more legitimately innovative firms that are carrying out very interesting projects and employing forward-thinking talent within their industries now face greater obstacles when claiming the R&D relief and credits they rightfully deserve.
From our perspective, the squeezing of the bad actors out of the R&D market has also inevitably led to multiple new, inexperienced firms into the capital allowances market, despite them lacking any experience or qualifications to do so.
The capital allowances regime has historically been altered to combat abuse of the regime, most notably in 2012 and 2014, which brought in rules meaning on nearly all commercial property deals you must inherit capital allowances from the Seller or get zero relief (with a small amount of exceptions). We have however seen some firms completely ignoring these rules, and just claiming on client’s behalf anyway, as there is no formal registration or checking of capital allowances claims unless there is an enquiry.
It remains to be seen whether this influx of inexperienced providers will lead to an increase in poorly structured claims, ultimately spurring further regulatory measures—such as mandatory claim notifications or detailed claim information forms—similar to those in place for R&D.
If you are currently seeking or will soon be in the market for a capital allowances advisor, please read our article “The Complete Guide to Picking a Good Capital Allowances Advisor.”
We would be pleased to speak with you, and support where we can add value to your business through property tax relief. Of course, we are certainly not the only good firm in the market. When shopping around for a provider, look for the following markers of a good firm:
Is the firm regulated or accredited by ICAEW, CIOT or RICS?
Are their people qualified and experienced in capital allowances?
At a minimum, it’s worth getting a quote from three providers who should provide a no obligations consultation and proposal for you.
Compare their service scope of works carefully – what’s included? What’s not included? Is someone’s fee too good to be true?
Do they provide HMRC enquiry support? A firm that offers robust after-care demonstrates commitment to their clients' long-term success.
