This client came to us following a recommendation by their own accountant for specialist tax advice. The client had a successful retail business including online sales. The existing business model meant that it was paying more corporation tax and VAT than it needed to. After thorough research of the legislation and HMRC guidance, we were able to propose a better business structure that would mitigate the corporation tax as well as VAT liabilities. Whilst majority of the tax planning was within the UK, the new structure also included elements of offshore tax planning which meant the UK corporation tax liability would be reduced.
Our analysis: The key for business growth is to have the right structure including a long term tax strategy. Once set up properly, the tax benefits can be reaped over a number of years bringing a significant return on investment for the specialist advice taken. We have come across a number of situations where businesses have grown without considering a long term tax strategy. The cost of then re-modelling a matured structure is usually quite high