One minute with Annette Beresford, partner and the head of tax at Humphreys Law Ltd.
What’s keeping you busy at work?
As I started my role as head of tax at Humphreys Law only a month ago, there are very few idle moments. We focus on the media and technology space, with a fast-growing tax and incentive practice which complements our core corporate and commercial offering. Coming from a big law background, it is truly impressive how agile and entrepreneurial a smaller practice can be.
My role includes advising on corporate transactions, often with an international dimension. We work a lot with tech sector start-ups, which need specialist advice on fundraising (often involving SEIS, EIS and VCT) and management incentives schemes. We typically get involved at around the ‘series A’ stage and then stick with the companies through the funding rounds. The tech sector is the most vibrant and dynamic part of the UK economy, and we expect the recent boom to continue well into the future.
If you could make one change to a tax law or practice what would it be?
I would reform the tax rules for early-stage businesses, especially around EIS and EMI, to make them less complex. The tax rules are meant to support young businesses to find funding and source the best talent. They are difficult to operate, however, and fraught with pitfalls by which a minor breach of the rules can lead to an irreversible loss of relief.
Early-stage companies often lack the resources to pay for specialist advice – and many don’t – which is why we see so many issues with EMI schemes when they are scrutinised on the occasion of an exit. We hope that the recent consultation on EMI (including on EMI eligibility) will signify a step in the right direction.
What do you know now that you wish you’d known at the start of your career?
How much work it would involve, and how difficult it is to find the right balance as a working mother. I had no idea, and that’s probably a good thing. What I have learnt is that there are many different ways of developing a career if you are adaptable. I have also been fortunate to work with some really great colleagues whose support has been invaluable.
Are there any new rules that are causing a particular problem?
The extension of the off-payroll working rules to the private sector, with effect from April 2021, is still bedding in.
An ongoing issue is the uncertain boundary between employed and self-employed individuals, which the new rules do not address. The updated HMRC CEST tool has its limitations, and there are a number of conflicting FTT and Upper Tribunal decisions. There is still no harmonised system for distinguishing between employees and contractors for tax and employment law purposes.
Has a recent development in tax caught your eye?
The covid-19 related lockdowns and travel restrictions have resulted in many people spending prolonged periods of time in a different place from where they were expecting to be. This can create difficulties in applying the rules governing individual and corporate tax residence and permanent establishments. The OECD issued guidance in April 2020 (updated in January 2021) with the aim of minimising the impact of covid-19. The tax authorities of various jurisdictions, including the UK, have followed with their own guidance.
HMRC’s broad view is that the existing rules provide sufficient flexibility to arrive at a result that is sensible and sympathetic to the taxpayer’s position. On the flipside, in cases where, before the pandemic, a taxpayer was already sailing close to the wind with regard to residence or PE planning, I would expect HMRC’s sympathy to be limited. There may be some interesting cases in this area coming through in the next few years.
And finally, you might not know this about me but…
I hold a full motorbike licence and once owned a 900cc Triumph Bonneville.
One minute with Annette Beresford, partner and the head of tax at Humphreys Law Ltd.
What’s keeping you busy at work?
As I started my role as head of tax at Humphreys Law only a month ago, there are very few idle moments. We focus on the media and technology space, with a fast-growing tax and incentive practice which complements our core corporate and commercial offering. Coming from a big law background, it is truly impressive how agile and entrepreneurial a smaller practice can be.
My role includes advising on corporate transactions, often with an international dimension. We work a lot with tech sector start-ups, which need specialist advice on fundraising (often involving SEIS, EIS and VCT) and management incentives schemes. We typically get involved at around the ‘series A’ stage and then stick with the companies through the funding rounds. The tech sector is the most vibrant and dynamic part of the UK economy, and we expect the recent boom to continue well into the future.
If you could make one change to a tax law or practice what would it be?
I would reform the tax rules for early-stage businesses, especially around EIS and EMI, to make them less complex. The tax rules are meant to support young businesses to find funding and source the best talent. They are difficult to operate, however, and fraught with pitfalls by which a minor breach of the rules can lead to an irreversible loss of relief.
Early-stage companies often lack the resources to pay for specialist advice – and many don’t – which is why we see so many issues with EMI schemes when they are scrutinised on the occasion of an exit. We hope that the recent consultation on EMI (including on EMI eligibility) will signify a step in the right direction.
What do you know now that you wish you’d known at the start of your career?
How much work it would involve, and how difficult it is to find the right balance as a working mother. I had no idea, and that’s probably a good thing. What I have learnt is that there are many different ways of developing a career if you are adaptable. I have also been fortunate to work with some really great colleagues whose support has been invaluable.
Are there any new rules that are causing a particular problem?
The extension of the off-payroll working rules to the private sector, with effect from April 2021, is still bedding in.
An ongoing issue is the uncertain boundary between employed and self-employed individuals, which the new rules do not address. The updated HMRC CEST tool has its limitations, and there are a number of conflicting FTT and Upper Tribunal decisions. There is still no harmonised system for distinguishing between employees and contractors for tax and employment law purposes.
Has a recent development in tax caught your eye?
The covid-19 related lockdowns and travel restrictions have resulted in many people spending prolonged periods of time in a different place from where they were expecting to be. This can create difficulties in applying the rules governing individual and corporate tax residence and permanent establishments. The OECD issued guidance in April 2020 (updated in January 2021) with the aim of minimising the impact of covid-19. The tax authorities of various jurisdictions, including the UK, have followed with their own guidance.
HMRC’s broad view is that the existing rules provide sufficient flexibility to arrive at a result that is sensible and sympathetic to the taxpayer’s position. On the flipside, in cases where, before the pandemic, a taxpayer was already sailing close to the wind with regard to residence or PE planning, I would expect HMRC’s sympathy to be limited. There may be some interesting cases in this area coming through in the next few years.
And finally, you might not know this about me but…
I hold a full motorbike licence and once owned a 900cc Triumph Bonneville.
