Reinforcing Trusted Advisor Status through Technology Innovation

Unlocking your status

Accountants that have embraced the trusted advisor role understand how important it is to ensure their clients get the best advice and support at every step, but that is hard to control or guarantee when any aspect of the service is outsourced.

Business owners have always relied on their accountants to be their ‘go-to’ for support, advice and help - to be looked after by them. Simply put, accountants are the trusted advisor to their clients and an integral part of their operation. Good accountants will firmly embed themselves into their clients’ businesses, providing comfort that they have an advisor who understands and supports their goals, removes unnecessary hassle from red tape and generally keeps them on track.

That said, there are pockets of service delivery, such as Research and Development (R&D) Tax Claims, that some clients still have to access through third parties because their accountants have not been able to unlock the capability to offer this service in-house – and this can potentially create business risk. Whether clients opt to work with another accountancy firm or a dedicated R&D Tax Claims consultancy, there is a chance that the accountant could be left picking up the pieces if the claim has been mishandled or worse still, they could lose the relationship to a full-service firm.

With recent research from WhisperClaims reaffirming that accountancy firms are increasingly driven by maximising efficiency, upholding best practice and being recognised as a credible professional by their clients, it is more important than ever to be able to provide a holistic, end-to-end client portfolio – and that includes R&D Tax advice.

Mike Dean, Managing Director of WhisperClaims, explains: “Dedicated cloud-based R&D Tax Claims technology, with training and support on tap, provides accountants with the ability to build and maintain strong client relationships and reinforce their trusted advisor status.”

How can an accountant sign off on a tax return when they have not been involved in the preparation of the R&D Tax Claim? Anyone can call themselves an R&D Tax specialist yet have no accounting background or tax qualifications - and importantly they will not be subject to the same level of regulatory scrutiny as certified accountants. Given the potential risks associated with outsourcing, many accountants are therefore looking to extend the depth and breadth of their service offering – and R&D Tax advice is becoming an increasingly important part of the overall service portfolio. Research carried out by WhisperClaims confirms that accountancy firms’ primary motive for providing R&D Tax advice is based around their role as a trusted advisor to their clients. The research revealed that firms want to be able to manage the end-to-end process without handing over responsibility to a third party; and while the additional revenue stream is obviously welcome, this outcome carries far less weight than the client satisfaction accountants want to be able to offer. For firms to be able to deliver a complete service portfolio for clients, it is vital to establish an efficient, cost-effective and reliable approach to preparing R&D Tax Claims. Just as technology has transformed every other aspect of the accountant’s role over the past decade, dedicated R&D Tax Claims software can empower accountants with a framework and structure that enables them to deliver a high quality service that is robust, compliant, and repeatable.

Embracing technology

SaaS technology, such as some R&D tax software, provides a financially scalable model to support accountants with variable levels of client demand for R&D tax claims preparation. It provides the foundation for a process designed to be used by qualified accountants with a strong understanding of their clients’ businesses and a fundamental understanding of the guidance and what qualifying work looks like.

Deploying technology to support R&D tax service delivery in this way not only facilitates easy collaboration between accountant and client, it also makes data easy to analyse, allowing accountants to demonstrate the viability and worth of a potential claim with confidence and reassurance that the work being put forward meets HMRC expectations. Access to training and expertise alongside the technology enables accountants to build up experience and extend their trusted advisor status.

The other huge benefit of dedicated SaaS R&D tax software is the continual evolution of the technology to keep users within the boundaries of the scheme and up to date with the changes being introduced by HMRC. From risk mitigation measures to the offer of optional claim reviews prior to submission, technology provides robust support to give accountants additional confidence. It should also support the more comprehensive sign off process between client and accountant demanded by HMRC from April 2023, ensuring the name and signature of both the advisor and a senior officer from the client are included in the claim.

Build confidence, access support, mitigate risk

For many accountants it is unlikely that a significant proportion of their client base will be engaging in qualifying R&D activity and therefore may find they are dipping in and out of the process only a handful of times per year. As such, it is really important that the individual(s) responsible for preparing claims have access not only to technology but also support, even if that is just a sounding board for advice and guidance.

HMRC’s R&D Tax Claim information can be opaque in places, and the ability for an individual to tap into the knowledge and experience of a team that has been involved with thousands of successful claims is hugely valuable. The best R&D tax software on the market is designed by R&D tax experts with hands-on experience of R&D tax consultancy and a solid understanding of the scheme.

Critically, by producing a high-quality output every time an accountant uses such dedicated technology, they can be confident that they are minimising the likelihood of prompting an HMRC investigation. And, even in the event of an HMRC investigation being launched, the structured and consistent process ensures an accountant can be composed and assured in responding to any additional questions HMRC may raise, with the added back up of advice, guidance and support offered by the team of R&D tax experts.

Conclusion

As well as supporting their clients’ business success, accountancy firms have themselves had to consider how they will build more sustainable and profitable businesses in the future. Technology has become crucial to this process. Exploring new technology to add R&D tax advice to their services portfolio allows accountants to meet their goals of maximising efficiency, learning and being recognised as a credible professional by their clients. It also enables them to do so in a robust and repeatable way whilst remaining compliant with the introduction of new and any future changes introduced to the scheme. There is no doubt that HMRC’s more rigorous approach to compliance within the R&D tax relief scheme will see advisors who push the R&D tax relief boundaries facing extra scrutiny and making way for firms committed to good practice to step up as the trusted advisors for their clients’ R&D tax relief claims. Clients deserve the best advice and who better placed to deliver this than their accountants?