Read the latest client story from our Financial Services team to find out how we helped Venture Capital Fund Manager.
Our client is a Venture Capital Fund Manager with an offshore fund.
Prior to our involvement they had been using a small firm of accountants, but they had started to become concerned that there might be opportunities or risks that they were missing or inefficiencies in the way their finances operated. Their existing advisor did not have the specialist knowledge required, so they approached Blick Rothenberg as a leading firm in the Private Equity and Venture Capital sector.
How did Blick Rothenberg help?
On appointment, our specialist team quickly got under the skin of the business, looking at structure, systems and procedures and speaking to the Directors to understand how they operated.
We found that the Directors had been advised that the firm was not eligible to register for VAT. This meant that they had been incurring costs at gross value with no ability to reclaim VAT for several years.
Whilst this advice would have been correct for the structure used by many similar firms, our team had the detailed knowledge of the rules to show that the specific structure of this client gave a different VAT treatment for the Manager, meaning that they could register for VAT and reclaim VAT on purchases although there were no sales subject to VAT.
We applied for a backdated VAT registration to the maximum four years and liaised with HM Revenue & Customs (HMRC) during the registration process to address the specific issues which often arise on Financial Services VAT registrations.
The VAT registration was successful, and the first VAT return we prepared for the client spanned a four-and-a-half-year period. As expected, the VAT return was subject to an inspection from HMRC, which we handled on the client’s behalf and under which our proposed treatment was accepted in its entirety.
Our specialist advice enabled our client to reclaim £127,000 of VAT from HMRC in relation to historical transactions. They are still VAT registered and continue to receive VAT repayments each quarter.
Would you like to know more?
If you would like to discuss whether your Venture Capital business is eligible for VAT registration or to discuss your specific circumstances, please get in touch with your usual Blick Rothenberg contact or a member of our Financial Services team whose details are listed on this page.
For more client stories detailing our work with Financial Services sector clients, visit our Financial Services hub here.