Many businesses may not be aware that their risk of incurring costs from an HMRC inquiry has increased. Fee protection insurance can help protect against financial shocks during a challenging economic period.
Fee protection insurance, which offers cover in the event of an HMRC inquiry or dispute, has in the past been seen as unnecessary by some businesses. The tax landscape is changing, however: as it emerges from the pandemic, HMRC have been recruiting new staff and signalling a renewed focus on scrutinising claims, particularly those relating to R&D.
As the likelihood of a tax investigation increases, so too does the value of FPI, as businesses running tight margins may not be able to absorb the shock of a large accounting bill. However, many accountants, conscious of maintaining an advisory approach over a sales-led one, have not followed up with clients who turned down FPI cover years earlier. As a result, these clients are left without cover that may have become more relevant to them since they last considered it.
In the past, accountants might have decided that the time, effort, and cost of postage necessary to canvas clients about FPI outweighed the benefits of doing so. That’s where Markel’s EngineRoom+ comes in. Our email marketing platform allows accountants to let their clients know about FPI at no cost and with very little effort. Fill in your client’s name and email address, and the system can create a totally personalised, branded and customisable email campaign. Our aim is to remove friction at every stage of the process.
“Unless we ask, we’ll never know”
Dominic Preist, head of tax sales at Markel Tax, shares his perspective on supporting clients with FPI cover:
“Being regarded as someone’s trusted business advisor is not only extremely flattering, but also very hard to achieve. When you achieve this status, it comes from recognition of the guidance, counsel and professionalism you have shown your client – as the title suggests, they trust you with their business. That trust will have been built based on the knowledge you have shared with them, your guidance, and sometimes the tough conversations you have had with them.
When engaging with clients, we all strive to always give the best possible advice and guidance based on how we can help them achieve their goals and ambitions, both commercial and personal.
Reflecting on this, it’s not clear why sometimes we make the decision to not introduce a relevant product or service to a customer. Perhaps the customer has said no in the past, or maybe we don’t believe the service is needed or relevant – but how can we be sure? Attitudes to risk change over time, changes in circumstance affect risk tolerance, commercial pressures vary, and ultimately, people change their minds. A client’s position last year could well have changed dramatically by this year – unless we ask, we’ll never know.
So why do we not periodically review the options available to our clients? Often, time is a barrier, or the financial investment needed to re-canvas every client’s opinion. But take a moment to consider the impact – in both time and money – should your client incur a cost that could have been mitigated had you introduced them to a product which would have protected them. How would that impact on your trusted business advisor status? We believe EngineRoom+ is the solution.”
For more information, please feel free to contact us.