In the world of FinTech, scale-up success often comes with a hidden cost. The speed of product launches, rapid market entries, and ambitious funding cycles can mask tax risks that only become obvious when they are already causing problems. For CFOs this creates a tricky balancing act between keeping pace with growth and staying ahead of complex and evolving tax obligations.
Why growth can hide tax risks
When a business is moving quickly the focus is often on opportunity not compliance. Product teams push to ship features faster, expansion teams move into new territories with short lead times, and funding rounds take priority over operational housekeeping. In that environment it’s easy for tax considerations to be pushed down the list.
The challenge is that tax rarely stands still. Rules shift regularly, new reporting obligations arise, and reliefs can be clawed back if not managed correctly. In FinTech this is especially acute because innovation often involves cross-border transactions, non-standard revenue models and complex intellectual property structures.
Common blind spots for FinTech CFOs
In our experience, several recurring issues have caught out other high-growth finance teams, often at a point where fixing them is costly and disruptive. These can include:
Share schemes
Equity incentives are a common tool for attracting and retaining skilled staff, but poorly structured schemes can trigger unexpected personal tax liabilities for employees and unnecessary costs for the company. Timing valuation and documentation are critical, and once a scheme is in motion it can be hard to adjust without consequences.
International VAT
FinTech businesses operating across multiple jurisdictions quickly face challenges in determining the place of supply, applying the correct VAT rates, and managing local registrations. Errors in this area often surface years later during audits or tax authority reviews, by which point penalties and interest have built up. There is also opportunity with international expansion whereby VAT exempt supplies to non-UK customers allow for VAT recovery on UK VAT costs – an area that is often missed by businesses in the sector.
Research & Development (R&D) tax relief overclaims
The innovative nature of many FinTech products makes R&D tax relief a natural fit, but claims can be risky if the criteria are misunderstood, or documentation is weak. HMRC scrutiny of R&D tax relief claims has intensified, and overclaims can lead to repayment demands that damage cash flow at the worst possible moment.
How to avoid being caught out
The key to staying ahead is to treat tax as a core part of the growth strategy rather than an afterthought. That means involving tax specialists early in discussions about new markets, products or funding rounds. It also means setting up processes so that tax implications are reviewed alongside commercial ones in every major decision.
Building a proactive tax framework
A proactive approach includes regular tax risk reviews built into your financial reporting cycle, a centralised knowledge base of key tax positions, and documentation and early scenario modelling for major strategic changes. This is not about slowing down growth; it’s about making sure it’s sustainable and defensible when tested by auditors, investors or regulators.
The role of outsourced expertise
For many FinTech CFOs bandwidth is the limiting factor. Bringing in external tax specialists either on an ongoing retainer or project basis can fill capability gaps while allowing internal teams to focus on high value strategic work. The right partner can spot risks before they become liabilities and ensure that tax reliefs like R&D are claimed robustly without overstepping compliance boundaries.
Fast growth will always carry risk but with the right approach, CFOs can ensure those risks are calculated, controlled and never allowed to undermine the very success they have worked so hard to achieve.
Bringing clarity to fast-moving FinTech
The tax blind spots we’ve highlighted – share schemes, cross-border VAT, and R&D claims amongst other areas – are exactly the kinds of issues My Tax Partner is designed to solve. Acting as your embedded strategic tax director, we help FinTech CFOs move at speed without letting compliance or missed opportunities hold them back. From structuring share incentives to navigating international VAT and securing R&D relief with confidence, we make sure your tax position strengthens growth instead of undermining it.
With regular agenda-led reviews and sector-specific insight, we take tax off your plate so your team can focus on scaling. You gain resilience, peace of mind, and the ability to make bold moves knowing your tax strategy is robust. My Tax Partner helps fast-growth FinTechs grow smarter and safer.
Our team has a wealth of experience working with Fintech firms. If you have any queries on the above points, reach out to the My Tax Partner team and let’s discuss.
