Start-up firms frustrated by HMRC’s ‘slowness and lack of communication’
- On January 24, 2024
- By GrowthInvest Marketing
The slowness of the UK’s tax authority HMRC is holding back entrepreneurs, according to a business group.
Buy Women Built (BWB) says its members have been left frustrated when trying to access tax incentive schemes designed to support start-ups.
The group said trying to contact HMRC was “very difficult” and in some cases delays in receiving the tax credits meant firms could not pay bills.
HMRC said “the overwhelming majority” of all valid claims were paid on time.
“In recent months the female founders in our community have increasingly experienced issues accessing key government incentives aimed at boosting new businesses and innovation,” says Sahar Hashemi, co-founder of BWB, a network of some 450 female entrepreneurs.
In particular, she points to R&D (research and development) tax credits and EIS (Enterprise Investment Scheme) tax relief.
R&D tax relief was introduced in 2000 in order to support small and medium-sized businesses (SMEs) when they invest in innovation.
EIS was introduced in 1994 and makes start-ups who qualify more attractive to investors. It allows shares to be bought in a more tax-efficient way.
“We would ask that an urgent review take place on the rules around funding, to ensure that all HMRC staff are aware of the legitimacy of these claims,” says Ms Hashemi, who co-founded High Street chain Coffee Republic and is the former co-chair of the government’s Scale Up Taskforce.
She claims the issues with HMRC are hitting female-founded companies particularly hard because they currently receive only 2% of venture capital in the UK.
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