In collaboration with Johnston Carmichael, Scotland’s largest independent accountancy firm, DWF’s Corporate Tax and Corporate experts discuss the impact of HMRC’s new R&D approach on R&D claims and corporate transactions.
The research and development (“R&D”) tax relief system is designed to encourage investment in innovation and drive economic growth. From April 2024, a new single merged R&D scheme will come into force for most businesses. Both the existing and new schemes allow eligible companies to claim tax relief either by way of a reduction to corporation tax that would otherwise be due or, in certain circumstances, via a cash payment.
Historically, most claims for R&D relief were paid out with little scrutiny by HMRC. This led to a perception that the risk involved in submitting an R&D claim was low and a ‘cottage industry’ of R&D claim firms developed, with large sales teams cold calling companies and encouraging them to submit claims, often on tenuous grounds. Professional firms and industry bodies highlighted the problem with HMRC, and attempts were made to raise awareness and warn clients, but the situation has continued for many years.
More recently, HMRC has become aware that levels of error and fraud within R&D claims was much higher than they had estimated. As a result, over the past two years, HMRC has introduced a series of compliance changes to identify potentially inaccurate or fraudulent claims and to target its enquiry resource accordingly. Although there is now evidence that the information being gathered is allowing HMRC to target high risk claims and/or agents, there is also concern that HMRC’s new enquiry approach is resulting in many legitimate claims being rejected.
HMRC’s new approach
HMRC has adopted a “volume compliance” approach to assessing R&D claims, meaning that there is now more chance than ever of HMRC enquiring into claims. Due to the scale of the volume compliance project and HMRC’s resourcing problems, different teams within HMRC are now reviewing R&D claims.
Historically, the Wealthy and Mid-sized Business Compliance team have been closely involved in R&D claim reviews and have built up expertise in this specialist area. However, to allow for the volume of enquiries, HMRC has engaged a large number of staff from the Individuals and Small Business Compliance team, who have limited experience in dealing with R&D claims and the training being put in place has not yet resulted in the level of knowledge and capability required. The result is that many genuine claimants are finding it extremely challenging to resolve enquiries into their R&D claims.
Impact on R&D claims
The concern with the volume compliance approach is that, although it may help in preventing fraudulent claims, it is also impacting many valid claims and discouraging companies from claiming in the future. It has also led to a huge backlog within HMRC in both processing initial claims and dealing with rejected claims. This volume compliance approach has been heavily criticised by many professional advisors and professional bodies, including the CIOT, ICAS and ICAEW.
The process for making an R&D claim has also become more protracted. HMRC has introduced a new online R&D claim submission portal and an Additional Information Form (“AIF”) must be submitted using this portal. The AIF requires supporting information to be provided, including technical narratives for specific projects.
As a result of the additional requirements to submit an R&D claim and the increased risk of HMRC enquiring into a claim (sometimes after HMRC has paid out the relief claimed), many R&D claimants will incur greater costs; not only professional advisor fees but also management time in gathering information requested by HMRC in an enquiry. Unfortunately, the information requested in enquiry letters often includes the information that has has already been supplied (for example in the AIF) but appears not to have been reviewed or considered as part of what can appear to be relatively standard enquiry templates.
HMRC’s compliance changes will not immediately improve the R&D claims advisory market and so it is important for claimants to consider carefully who they engage to assist them with their claims. It may surprise many that a lack of regulation means that anyone can set themselves up as a tax advisor, regardless of qualifications or experience. Companies should engage with tax advisors who are appropriately qualified and experienced, likely members of a relevant professional body, with reputable R&D and corporation tax specialists that understand the risk profile of R&D claims and who can help deal with, and even pre-empt, HMRC enquiries. Not only will this save claimants’ time and money, it will ensure they maintain a good reputation and clean tax record with HMRC.
Impact on transactions
HMRC’s new approach is also having an impact on corporate transactions where the target company in question has made R&D claims. Buyers are carrying out increased due diligence on the R&D risk profile of target companies and, if material risks are identified, are often looking for price retentions or even price adjustments to reflect the risk to value.
If either party to a transaction is looking to take out Warranty & Indemnity (“W&I”) insurance, R&D risks are still potentially coverable by the W&I policy. However, insurers are more cautious of providing cover given HMRC’s new approach and good reporting of R&D claims will be key if cover is to be obtained.
If, in carrying out its due diligence on a target company, a buyer uncovers concerns relating to R&D claims, this risk is likely to be excluded from cover under the policy as a “known risk”. A buyer is likely to still want cover for the risk and so a specialist standalone tax policy may need to be sought (leading to increased costs for the buyer). If that cannot be obtained then an indemnity from the seller, a price adjustment or a price retention will likely be on the table.
Dealing with R&D enquiries
Many companies are finding themselves, after an exchange of letters, in a deadlock with HMRC, where they are unable to agree the eligibility of their claim, unable to engage in a discussion with anyone via a call or meeting and there is no clear escalation route.
There are several options that can be considered, including alternative dispute resolution, making a formal complaint to the Adjudicator’s Office and requesting an internal review, requesting a closure notice to allow a formal appeal, requesting a statutory review and/or ultimately taking an appeal to the tax tribunal. With all of these, there are strategic decisions to be made, timing and cost implications to be considered and it’s important to get advice to navigate through to a resolution in the most efficient way.
Where does that leave us
HMRC is aware that its approach is being criticised and has committed to further caseworker training and improving responses to claims. However, it is not expected that HMRC’s approach will change soon.
It is therefore extremely important for claimants to engage qualified, experienced R&D tax advisors. If you are approached by an R&D firm, use Linkedin to check the background and qualifications of the individuals you are introduced to. Do they have relevant qualifications or experience or do they have a “sales” background. It is also fair to question the motivations of the advisor. Do they have a wider business relationship with you or are they seeking a standalone engagement to work on the R&D claim on a contingent fee basis, which might incentivise them to push the boundaries in preparing the claim. An HMRC enquiry could result in interest, penalties and other reputational consequences. Additionally, if claimants are looking to sell their businesses in the future, R&D compliance is even more important as a potential buyer is unlikely to take the risk on R&D unless claims have been dealt with appropriately.
In Summary
Understanding your corporate tax obligations and the potential industry changes can be overwhelming. Our Corporate Tax team can support your needs now and in the future. We do this by keeping ahead of developments in the market to ensure you and your business are well equipped, resilient and as risk free as possible.
We work alongside your corporate deal team to help cut through the complexities, advise on ways to mitigate personal and business risk and offer innovative and tax-efficient solutions to meet your business needs.
We can help you to navigate the complexity of the UK tax rules, seek any necessary advance assurance or approval from HM Revenue and Customs, consider the impact of amendments to articles of association, share rights, management/employee incentive arrangements or investment agreements.
We would like to thank Andrew McMillan and David Ward at Johnston Carmichael for their contributions to this valuable insight.
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Andrew McMillan Tax Partner & Head of Innovation Taxes
Andrew.Mcmillan@jcca.co.uk
David Ward Tax Partner & Head of Specialist Taxes
David.Ward@jcca.co.uk
Caroline Colliston
Executive Partner, Tax
Caroline.Colliston@dwf.law
M: +44 (0)7841 843 744
Zita Dempsey
Associate, Tax
Zita.Dempsey@dwf.law
M: +44 (0)7542 615056
Gary MacDonald
Partner, Corporate
Gary.Macdonald@dwf.law
M: +44 (0)7713781375
Edinburgh Leisure, the city’s leading sports and leisure provider, has received a significant grant from the Encouraging and Supporting Grassroots Activity Fund to support their dementia programme.
Funded by Age Scotland’s About Dementia project in partnership with the Scottish Government, Edinburgh Leisure has received £19,800 to support their Movement for Memories programme.
Sam Scott, Development Officer at Edinburgh Leisure, welcomed the support saying: “We’re delighted and thankful to receive the grant. The funding will enable us to continue offering people with dementia in Edinburgh a range of opportunities to keep active, from 1:1 support from buddy volunteers to enjoy activities of their choice, to dementia friendly activities within our sports and leisure facilities, to our physical activity outreach service with community groups across the city.
“Edinburgh Leisure is always looking for volunteers to support people living with dementia. Our volunteers make a real difference by accompanying and supporting individuals with dementia to take part in a physical activity of their choice, like gym, golf, fitness classes, tennis, or swimming. Whatever the participant enjoys, your support will play a vital role in helping them enjoy their activity and improve their wellbeing. So, if you have an interest in health and physical activity, we’d love to hear from you.”
The funding will support people like 79-year-old David, who plays badminton with his buddy volunteer at Craiglockhart Leisure and Tennis Centre. His sister and carer Julie said: “David used to play football professionally, so physical activity has always been a big part of his life. He wanted to keep active, but his dementia meant that he could no longer do it without extra support.
“The change in him since he started playing badminton has been enormous. His short-term memory is poor, but he remembers how to play, and he hasn’t lost his competitive spirit. He comes out of the session like a new man – his spirits are lifted, he’s chattier, and often his memory seems to improve for a while. He’s almost like ‘enhanced David’ when I pick him up.”
Movement for Memories offers people at all stages of their dementia journey with a range of options to be active, from personalised one-to-one support to enjoy activities they previously enjoyed independently but need a helping hand with now, to a physical activity outreach service for local support groups to enable people to get active in familiar community settings like church halls or community centres. All participants referred to Movement for Memories receive an Edinburgh Leisure card providing 12-weeks free access to gym, swim, golf, tennis, and fitness classes followed by 9 months of subsidised access.
Not only does getting active help participants to maintain or improve their physical health, but it also helps them to improve their mental wellbeing, build social connections, remain integrated in their community and maintain independence for longer.
Dementia affects an estimated 8,000 people in Edinburgh and 90,000 people in Scotland, an estimated 3,000 of whom are under 65. Dementia is not an inevitable part of ageing. It is an umbrella term that can be caused by a number of diseases which, over time, damage the brain, typically leading to deterioration in both brain and bodily health. The most common types of dementia are Alzheimer’s disease, vascular dementia, mixed dementia, dementia with Lewy bodies, and frontotemporal dementia.
To find out more about Movement for Memories, visit: http://rb.gy/xeua2l
To find out more about being a Movement for Memories Buddy Volunteer, visit: http://rb.gy/nzsnp7
The Royal Edinburgh Military Tattoo has announced one of the country’s leading outdoor performance specialists as its new Creative Director.
Alan Lane will take over from Michael Braithwaite, the first ever dedicated Creative Director, who completes his planned and highly successful three-year Show run this August following the conclusion of the Show, Journeys.
Having spent 20 years as Founder and Artistic Director of the theatre company Slung Low, Alan has worked on a variety of outdoor spectaculars for organisations including the BBC, the Royal Shakespeare Company and Liverpool, European Capital of Culture, and brings passion and a host of experience to the role.
Currently based in Leeds, Alan grew up with both his father and grandfather in the military, and much inspired by them became an Army Reservist in 2015. Alan’s experience in the Army Reserve and as creative consultant for the Army Expo 2022 and 2023, will help take Tattoo performances to new dynamic and immersive levels.
He was also co-director of The Awakening in 2023, the opening ceremony of LEEDS 2023 – a year of culture, with the show performed in Headingley Stadium featuring an eclectic mix of dancers, music, and a variety of performances to celebrate the city’s culture.
In Micheal’s final year, Alan will join the Tattoo team next month as planning for this year’s Show takes shape, taking this time to get under the skin of the Tattoo production and brand, while learning from the expert teams to build plans for the much anticipated 75th Anniversary Show.
Jason Barrett, CEO of The Royal Edinburgh Military Tattoo, said: “Firstly, I’d like to say a huge thank you and congratulations to our outgoing Creative Director, Michael Braithwaite, whose passion, and dedication has helped us deliver spectacular performances throughout his tenure and we wish him all the best for the future.
“Our success beyond this year will be the result of the creative foundation laid by Michael over his four years and three shows as the Tattoo’s first ever Creative Director. And for this, we are forever grateful. Michael’s work, along with the entire production team’s efforts, makes way for our next chapter to be led by our new Creative Director
“Alan joins at what is an incredibly exciting juncture in the Tattoo’s history, with the 75th anniversary on the horizon and growth beyond Edinburgh in the years to come. His wealth of experience, obvious talent and creative vision will be a real boost for us at the Tattoo and I’m looking forward to working alongside him over the coming years as we seek to wow audiences both at home and abroad.”
The Tattoo is rooted in creativity and connection with a special ability to bring people together on a local and international scale. Throughout the Tattoo’s history, there is a deep understanding of the importance of connection and wider contribution to community through charitable contributions.
For his services to the community in South Leeds during COVID-19, Alan was awarded a British Empire Medal (BEM), aligning with the Tattoo’s mission to increase donations to support associated organisations.
Alan Lane said: “Throughout my career, I have been honoured to work on large scale productions around the world, but nothing compares to the spectacle of the Tattoo.
“When the role was advertised, I had so many friends and family share the position with me as they knew, like I did, this is a once in a lifetime role. It’s the perfect opportunity to combine my military experience as an Army Reservist and my career as a performance director to continue to create the world’s greatest immersive event on the Castle Esplanade and beyond. I can’t wait to get going.”
Following a period of discovery with Michael Braithwaite, Alan will take over as Creative Director from September, where planning for next year’s 75th anniversary Show will be developed.
Tickets are on sale now and can be purchased at edintattoo.co.uk/tickets or on the phone, 0131 225 1188. The Show will run from 2-24 August 2024, with Presenting Partner, Innis & Gunn, offering a bar service at the event.
Journeys will transport audiences on an international cultural journey, with the Royal Navy taking on the role of lead service, bringing together the voices and stories that connect the worldwide company of The Royal Edinburgh Military Tattoo. Returning to the Castle Esplanade will be Tattoo favourites, from the Massed Pipes and Drums to the emotive Lone Piper, alongside the culture and vibrance of an international cast.
Like last year, tickets for 2025’s Show celebrating the 75th Anniversary of The Royal Edinburgh Military Tattoo will go on sale in August during Journeys.
- Businesses report recruitment conditions have eased, with fewer firms facing difficulties in hiring
- 66% of responding firms say they’ve faced challenges finding staff, the lowest percentage in three years
- Companies in the production and manufacturing sector are the most likely to report challenges in hiring staff (70%)
- 62% of companies attempted to recruit in the quarter
The latest Quarterly Recruitment Outlook (QRO), a survey of more than 4,600 UK firms of all sectors and sizes, by the British Chambers of Commerce (BCC) Insights Unit, reveals hiring problems have eased.
The first quarter results for 2024 show that 62% of respondents said they had attempted to recruit in the last three months, slightly up from 59% in Q4 2023. Of these firms, fewer reported recruitment difficulties, 66% compared with 76% in Q4 of last year. It’s the first quarter the figure has fallen below 70% since the economy reopened post-pandemic (Q2 2021).
Production and manufacturing firms are bearing the brunt of the staffing issues, with 70% of businesses reporting hiring problems in Q1. However, that’s down from 77% in the final quarter of last year. In both the construction/engineering and transport/logistics sectors, 69% of firms said they had experienced recruitment difficulties, while the hospitality sector reported 64%.
Of the manufacturing firms reporting problems, 70% faced challenges finding skilled manual/technical staff, and 35% semi/unskilled workers.
As businesses continue to face unpredictable economic conditions, the majority are struggling to increase investment in workplace training. For the third quarter in succession, just over a quarter of businesses (26%) reported an increase in staff training investment, with 12% reporting a drop, compared to 14% in Q4 2023.
Responding to the findings, Jane Gratton, Deputy Director Public Policy at the British Chambers of Commerce said:
“It’s welcome that the recruitment picture is improving and the percentage of firms reporting difficulties is at its lowest level for three years. This comes as other indicators show the labour market is cooling.
“However, with 66% of firms still facing hiring challenges, the problems remain significant. Too many employers are struggling to find people with the skills they need to fill job vacancies. That’s damaging business opportunities and growth.
“The growing number of people not looking for work, or out of action because of long-term health issues, is exacerbating the skills problem. More needs to be done to tackle the issues behind this worrying trend and help people back into the workforce.
“We need a long-term industrial strategy, underpinned by better skills planning and more investment in training. That needs to happen nationally, locally and in every business. We need to support everyone who wants to work to achieve their potential. Doing that will help tackle skills shortages – improving growth and opportunities in local economies across the UK.”
Family-owned Apex Hotels has completed the acquisition of Meldrum House Country Hotel and Golf Course in Aberdeenshire. This is the group’s second rural property following the purchase of Pine Trees in July 2023 and is the 10th hotel within its UK wide portfolio.
Meldrum House is a stunning 51 bedroom 4-star country house hotel comprising of a 13th century manor house and golf course, set in 250 acres of Aberdeenshire countryside. Privately owned by Aberdeenshire businessmen Bob Edwards, Terry and David Buchan, the hotel has won a range of prestigious awards including The Times’ Top 100 UK Hotels and Best Hotel at Visit Scotland’s Scottish Thistle Awards.
The purchase of Meldrum House demonstrates Apex Hotels’ continued strategy to grow and diversify its portfolio with new hotels in rural locations. The acquisition follows another strong financial year for the group, supported by a £60 million refinancing package with Barclays.
Apex Hotels Chief Executive Officer Angela Vickers said: “The acquisition of Meldrum House Country Hotel represents an opportunity to continue to diversify the Apex Hotels portfolio, giving our guests even more choice of a city or more relaxed rural option.
This is an exciting time for Apex, and after getting to know the team at Meldrum House, it was clear they share the same vision and ambitions we have at Apex Hotels. Meldrum House will be one of our flagship hotels and we are delighted to be the next custodians of this historic property.”
Bob Edwards commented; “After 31 years of owning Meldrum House with David and Terry Buchan, it is the perfect time to hand over the reins for a new chapter, where the hotel and estate will become part of Apex Hotel’s expanding portfolio. As a family owned and run business, we are delighted that the Springford family have the same principles and passion for what we have created and together with Dave and Terry Buchan, I wish them the very best for the next 30 years of Meldrum.”
ABOUT MELDRUM HOUSE
Meldrum House Country Hotel and Golf Course Meldrum House Country Hotel and Golf Course is an award-winning 4-star hotel, only 20 minutes from Aberdeen city centre, set in 240-acres of Aberdeenshire countryside. Their Knights Golf Course ranks in the Top 100 golf courses in Scotland by Golf World.
Bob Edwards, together with brothers David and Terry Buchan, bought the hotel and estate back in 1993. The Knights Golf Course then opened in 1998 and celebrated its 25th anniversary last year, hosting the Scottish Men’s Amateur Championship. A multi-million refurbishment in 2009 elevated the hotel’s status and in 2016 further major investment created more bedrooms and a ballroom for up to 200 guests.
Notably, the hotel has won a plethora of awards including a Visit Scotland Scottish Thistle for ‘Best Hotel’ as well as being named as one of The Times Top 100 UK hotels. It also claimed a prestigious industry Catey Award for ‘Best Marketing Campaign’ in front of industry leaders in London, for their luxury dining domes which were launched in July 2020.
- Royal Bank of Scotland colleagues have created the Gogarburn Tree Nursery at their Edinburgh site to support Scotland’s biodiversity.
- Michael Duncan, Head of Giving Strategy & Programmes at the Royal Bank of Scotland, The Conservation Volunteers CEO, Rebecca Kennelly MBE and Francesca Osowska, CEO of Nature Scot officially launched the new nursery.
- Royal Bank of Scotland have supported conservation projects with The Conservation Volunteers since 2007.
Royal Bank of Scotland colleagues have launched a new tree nursery at the Gogarburn headquarters in Edinburgh, in partnership with The Conservation Volunteers, whose mission is to connect people to nature and to nurture green spaces for local communities.
This tree nursery is part of the ‘NatWest Forest’ initiative, which invites colleagues across the business to take part in planting and nurturing trees across Scotland. Since autumn 2021 NatWest Forest has grown to encompass 150,000 trees across the UK, with 3,800 currently onsite at Gogarburn.
Overseen by The Conversation Volunteers, tree seeds that have been collected by colleagues, are being grown in the Gogarburn nursery. They will be tended to for the next two years and will then be planted around Scotland creating a legacy of locally sourced and grown trees for many years to come. All saplings planted at the site are native species to Scotland including Scots pine, field maple, holly and birch. The site will support the biodiversity of Scotland, allowing declining species of trees that are rare and valuable to the environment to be replenished while protecting native habitats for wildlife.
Royal Bank colleagues have contributed more than 26,000 hours of volunteer time with The Conservation Volunteers in 2023. Together with volunteer effort, this most recent project has been enabled through expert advice from The Conversation Volunteers who have led on the construction of the tree nursery and preservation of the natural environment
The project is another example of the bank’s work and commitment to tackling climate change. The financial partner for COP26 in Glasgow in 2020, 16,000 people across the bank will take part in a climate education programme by the end of this year. The training is being delivered in partnership with the University of Edinburgh and gives colleagues the skills to support customers with their own climate ambitions.
Pictured are Michael Duncan, Head of Giving Strategy & Programmes at the Royal Bank of Scotland and The Conservation Volunteers CEO, Rebecca Kennelly MBE alongside special guest Francesca Osowska, CEO of Nature Scot, who champion projects like this to improve Scotland’s biodiversity and geodiversity.
Michael Duncan, Head of Giving Strategy & Programmes, Royal Bank of Scotland, said: “We are delighted to launch the Gogarburn Tree Nursery, this new, innovative and forward thinking project with our long standing charity partner, The Conservation Volunteers.
Through this project, our colleagues will support by collecting local native tree seeds and growing these at our tree nursery on our campus. This will enable indigenous trees to be planted across Scotland leaving a true legacy for years to come, while providing colleagues with opportunities to learn more about nature based climate solutions.”
Rebecca Kennelly MBE, Chief Executive, The Conservation Volunteers, said: “This new innovative project demonstrates how the teams are constantly renewing and planning for volunteering to leave a lasting impact on climate, wildlife and communities.
“The Gogarburn Tree Nursery project is a brilliant example of volunteers supporting a closed loop; from collecting and propagating seeds, to the trees grown here being planted in local green spaces by more volunteers in years to come. A great new way for NatWest Group volunteers to connect with nature”.
The findings from Burges Salmon’s ESG report show that Energy and Utilities companies are very prepared to meet corporate disclosure obligations, but there’s still room for improvement
As businesses continue to develop the application of robust ESG standards into everyday operations, efforts could be undermined by compliance failures within their supply chain. This is according to new research published by independent UK law firm Burges Salmon.
In order to gauge how UK companies are reporting on the full ESG value chain of their operations, Burges Salmon surveyed over 360 business leaders from across sectors to shed light on how prepared businesses are to meet their supply chain-related ESG disclosure obligations, set to be further tightened by a raft of new legislation, including the EU Corporate Sustainability Reporting Directive.
The report – Supply chain ESG disclosure – is your business ready? – reveals that 32% of all businesses surveyed are completely unprepared to meet their ESG supply chain disclosure obligations and among those, only 29%, fewer than 3 in 10, believe their organisation fully understands the legislative and regulatory landscape governing ESG corporate disclosure.
Michael Barlow, partner and Head of ESG at Burges Salmon, says: “UK companies must first prove their commitment to ESG by complying with a range of mandatory disclosure obligations. Ensuring business partners meet ESG standards requires investment, resources and constant monitoring, and it is clear from our research that most companies still have some way to go.”
The findings position the Energy and Utilities sector firmly as the leader of the pack, with 68% of those surveyed saying their company’s ESG commitments and those of its supply chain are well aligned, and two thirds of respondents also claiming to have someone at senior level monitoring ESG policies, procedures, and compliance with regards to the supply chain.
James Phillips, partner and Head of Energy at Burges Salmon, comments: “In terms of the larger established energy and utilities companies, I think there is a high level of sophistication, expertise and understanding of what it is they need to be doing, and how to approach implementation.”
That is not to say the sector isn’t facing challenges and the data points to a number of areas where sharper focus is needed – in fact, 46% of respondents in the sector say their company has developed a code of conduct in respect of ESG matters that is adhered to by the supply chain, and only 47% say their organisation has detailed procedures in place to assess the ESG compliance of prospective supply chain companies.
Highlighting Scotland as the UK nation that is most prepared, the report goes on to explain that it is factors such as the size of the Energy sector that is driving this upward trend. Indeed, Scotland’s traditional oil and gas sector has demonstrated a commitment to environmental protection, energy transition and Net Zero strategies. Other large sectors such as financial services are also influenced by the shifting priorities of investors towards ESG and the reputationally advantageous position of putting ESG at the heart of business policies.
Malcolm Donald, a partner in Burges Salmon’s Edinburgh office says: “Through the conversations I’ve had with clients based in Scotland, I’ve noticed that much of the ESG focus has always been on the environment, but there’s certainly much more focus on social and governance now and I think that has been driven by internal stakeholders. The other thing that clients are recognising, is that it is no longer just about what they do, but it’s about making sure that their supply chain is doing the same thing in a demonstrable way.”
Leveraging its market leading ESG expertise, Burges Salmon has developed a number of practical tools to consolidate all ESG guidance, legislation and other useful resources into interactive and intuitive platforms. Amongst those is the firm’s ESG Corporate Disclosure Tool, where clients can seamlessly navigate between the law, ESG disclosure obligations, best practice and training guidance, to help them identify potential risks and unlock the opportunities so they can derive real value from it.
- New Research Says Interest In Scottish Firms Amongst Investors Fell Last Year By A Third
- Slow Progress With Freeports And Investment Zones Could Hold Back Economic Levelling Up
Specialist business lawyers at Wright, Johnston & Mackenzie are calling on the Westminster government to press ahead with its Investment Zones and Freeports agenda in Scotland following new figures which reveal that interest from overseas investors in Scotland’s businesses has stalled.
The law firm has analysed industry data* and says although the UK continues to drive significant interest from foreign buyers, the number of Scottish firms which were targeted in an overseas deal, such as an acquisition or a management buyout, fell to 23 last year compared to 36 in 2022.
Volume of overseas investment deals into Scotland (Source: Experian, Wright, Johnston & Mackenzie analysis)
The research says foreign investment in the UK is increasingly concentrated in London and the South East, with these areas accounting for 42% of deals in 2023, up from 35% in 2019.
Fraser Gillies, managing partner at Wright, Johnston & Mackenzie, said:
“This new research highlights that investment activity in the traditional FDI hotbed in the South East of England has increased, whilst in Scotland, deal activity has been rising steadily over the last five years but reduced in the most recent twelve months.
“Government initiatives such as freeports and investment zones could be a gamechanger for providing favourable conditions for UK based businesses, attracting more interest and investment from abroad, and levelling up the economy.
“Making the UK the top investment destination in Europe, attracting new investment into communities and helping to level-up the country, is one of five key priorities for the Department of Business & Trade. Providing tailored support for each investment zone and promoting what Scotland has to offer on an international stage is a crucial part of this.”
Investment Zones and Freeports aim to drive investment and innovation across the UK, offering a favourable environment for businesses to grow.
The UK government says it is committed to establishing 13 Investment Zones across the UK and last summer, together with the Scottish government, it announced the Glasgow City Region Regional Economic Partnership and the North East of Scotland Regional Economic Partnership.
The expectation is that many of the zones will go live in spring 2024 but so far Liverpool is the only zone to have officially done this, announcing details of its proposition last month. Experts at Wright, Johnston & Mackenzie say it’s imperative for the country’s future growth that those in Scotland are brought forward as soon as possible.
Designed to also boost economic activity and the ‘levelling up’ agenda by fostering trade, investment and job creation around maritime ports and airports, Freeports allow goods to be imported without the usual tariffs. Additionally, companies operating within freeports can enjoy reduced property taxes and national insurance rates, further incentivising business growth and new employment within these zones.
Scotland is set to establish two new freeports, one at the Firth of Forth and another at Inverness & Cromarty Firth, as part of a joint initiative by the UK and Scottish governments.
The Forth Freeport aims to draw £6 billion in investment, create 50,000 jobs, and contribute £4.2 billion to the local economy within five years, focusing on sectors like renewable manufacturing and shipbuilding.
The Inverness & Cromarty Firth Freeport is expected to generate 16,500 jobs and £3 billion in investment, emphasising renewable and low-carbon energy sectors to support the transition to net zero. Both sites will include significant expansions and developments to foster innovation and skills growth.
Foreign Direct Investment (FDI) refers to an investment in an enterprise operating in a foreign economy, where the purpose is to have an ‘effective voice’ in the management of the organisation. According to the latest ONS data, FDI into the UK has increased year-on-year for a decade to stand at over £2 trillion by 2021.
Award winning Scottish housebuilder Cruden Homes is bringing 37 new homes to a growing family friendly community at Hawkhead, situated on the edge of Scotland’s largest town in Paisley.
Hawkhead Mews is a new development on the grounds of the former Hawkhead Hospital and just over a mile from historic Paisley town centre. The 37 new properties for private sale have been designed for modern and flexible living and feature three-bedroom semi-detached homes and three-bedroom terraced townhouses.
The development will support major community growth across Hawkhead, which has seen a surge in new build properties in recent years due to its popularity with couples and families.
Hawkhead Mews is ideally situated in a quiet, leafy location, close to the beautiful Barshaw Park with cafes, shops and a great choice of schools, combined with easy access to a vibrant town centre with historic landmarks. For leisure enthusiasts, Ralston and Barshaw Golf Clubs are on the doorstep and the Lagoon Leisure Centre provides a variety of options for active families living in the area.
Hawkhead train station is only a few minutes’ walk away and offers a direct service to Glasgow city centre in just 16 minutes. It is also very well connected to the M8 and M77 motorways and to Braehead and Silverburn shopping centres.
Hazel Davies, Sales and Marketing Director of Cruden Homes, said: “Hawkhead is a fantastic location and ticks all the boxes for modern family living. These spacious and flexible new homes are set in a thriving and established community with a wealth of amenities and easy access to Paisley, Glasgow and the central belt. This is an exciting new addition to our portfolio of new homes across the West of Scotland, having recently launched Cleddans Grove in Drumchapel.”
The sales launch is planned for May and the first homes are expected to complete in Autumn 2024. Buyers are urged to register their interest now to avoid missing out. https://www.crudengroup.co.uk/homes/developments/hawkhead-mews
26th April 2024
Tee Times From: 9:30am
£320.00 per team of four
Experience links golf at its finest with the Texas Scramble event at Turnberry Resort. Gather your team of four and conquer the magnificent King Robert the Bruce course, surrounded by stunning Scottish landscapes. Before teeing off, enjoy a hot beverage and a bacon roll. To book, please visit turnberry.info/texasscramble or email proshop@trumpturnberry.com.
