Corporate tax

Virtually all commercial transactions have tax implications. Tax is thus an important practice area for any major law firm. Working in tax involves advising clients on the risks associated with acquiring, selling or restructuring assets and negotiating key considerations in the transaction to ensure the smooth completion of the deal. On the contentious side, tax lawyers advise on all aspects of tax litigation and investigations, including negotiation with tax authorities.

Last-minute trips to Paris and leading closing calls are among some of the highlights newly qualified tax associate Nick Humphries picks out from his recent training contract at magic circle firm Clifford Chance.

Having started his training with the law firm in August 2020, Nick qualified into the tax team in August 2022, following seats in: asset finance; SABRE (structured asset backed real estate finance); tax; and litigation, arbitration and dispute resolution. During his final seat, Nick spent three months in the firm’s London office and three months on secondment to a charity that specialises in housing law, in what he describes as a “split seat”. But it was his time in the tax team that he most enjoyed: “I enjoyed the ability to work on a range of both finance and corporate transactions involving complex questions and was encouraged to think differently within a very supportive and engaging team.”

Why law?

Deciding on a career and running with it is a daunting process to say the least. However, Nick’s reasons for choosing a career as a solicitor show that enough thought and research can make that decision a little easier. “There were three main reasons for deciding to be a solicitor”, he starts. “The first is that I work much better in a team and with a collegiate environment around me. The second is that I like to see matters through from start to finish.” Looking at how barristers work and the way they’re often instructed on matters halfway through, Nick quickly realised that the style of work associated with the Bar wasn’t quite what he was looking for from a career.

His final reason for pursuing this path relates to the nature of the work on offer for a solicitor. “I enjoyed and wanted to be working on commercial deals for most of my workstream”, he explains. While contentious work makes up a part of Nick’s workload, the majority of his time is spent “working on transactions that have a positive outcome for both parties” which Nick finds to be "particularly rewarding".

Nick’s experience as a trainee confirmed he’d made the right career choice. As he looks back over the past two years, Nick shares several highlights from his training contract – two of which particularly stand out. “First, I was fortunate enough to lead a closing call for an aircraft sale, which was particularly exciting. There were about 40 different lawyers, the clients from both sides of the deal, insurers and anyone else involved in the transaction on the line. I had the honour of reading the closing script and formally confirming that the deal had closed, and that title to the aircraft had passed.”

This early level of responsibility was a fantastic opportunity, and one Nick recalls fondly. As well as leading closing calls, Nick's second highlight was towards the end of his training contract when he was asked to attend an impromptu, and “very exciting”, trip to Paris – not to sip coffee on the Rue des Barres, but to deliver some important, last-minute documents for a hearing being held in the French capital. So, it’s clear there’s a lot more to being a trainee than one might initially think.

Life after training and challenging economic times

Since qualifying, Nick’s work has stepped up a gear. While still involved with the drafting and researching aspects of a matter, as an associate he now has more responsibility: “As a trainee at most firms including Clifford Chance, you are only in departments for six months and so some transactions might cut across that period. One of the main advantages of being an associate is that you’ll be on the transaction right from the start and see it through to the end.”

Due to the nature of the work, Nick is now involved with the various stages of each matter he works on and enjoys being part of the conversation that helps to “move the transaction forward”. Taking a step back, Nick outlines the type of work he finds himself doing: “The main job of a tax solicitor is to spot issues and manage the risks associated with those issues. So, that might mean spotting something in the legislation that suggests there could be  a risk to a client, or seeing a practical issue in a structure paper that may cause a problem during the transaction, or in the future. As a result, there might need to be specific drafting incorporated into the transaction documents to appropriately manage these risks.”

Communicating every day with clients and other teams across the firm, including overseas offices, researching and generally managing aspects of the transaction are some of the other tasks Nick is involved with on a day-to-day basis.

To do this work well, Nick must stay up to date with the state of the economic climate across the world and the challenges that might get thrown up due to the volatile nature of the economy. “There are a variety of issues in the world of tax at the moment – in the UK, Europe and across the world”, he explains. As widely reported everywhere, the UK is facing some hefty challenges when it comes to the economy with "changing budgets and government” – this, of course, feeds into the type of work Nick receives from clients as they "manage the risks” associated with the economic crisis in the UK and beyond. Nick says: “Part of our job is to help guide clients through decisions they may choose to take in challenging economic times, which can sometimes lead to difficult tax questions.”

Looking further afield, Nick focuses on the issues at the forefront in Europe. “There’s a greater movement towards trying to prevent the misuse of so-called ‘shell entities'. Because of this, new European-level directives are being negotiated and drafted with the potential to come into force in the next few years.” It doesn’t stop there though, at the worldwide level, “countries often have what’s called a ‘double tax treaty’, which, among other purposes, seeks to allocate the taxing rights between countries and protect against the risk of being taxed twice in two separate states”, Nick outlines. “Depending on the political climate between countries, those can be renegotiated, or new tax treaties might come into play. For example, just last week I worked on a matter involving the Japan and Colombia double tax treaty, which was only recently agreed.”

The law is vast

What are the skills required to be successful in Nick’s role? Generally speaking, time management, asking questions and being resilient are all incredibly important and “are applicable in many different jobs”. But when Nick turns his attention to the skills necessary to be a great tax lawyer, he says: “It’s particularly important to be able to spot an issue that might be quite technical in the legislation, and translate and communicate it to other members of the team and the client. You also need to enjoy reading aspects of technical legislation and understand the purpose behind it, what it’s trying to achieve, and how the transaction fits into the legislation, which in some cases can be hundreds of years old.”

If you’re thinking, ‘yes, this sounds like me’, take heed of Nick’s advice. “Ask as many people as you can about what their job involves”, he says before outlining the various ways that aspiring lawyers can speak to solicitors, including open days and work experience like the firm's award-winning SPARK scheme. He urges candidates to “find out about the different work on offer and to keep an open mind because there might be certain types of work you didn’t think you’d enjoy but you end up enjoying” and vice versa.

The law is incredibly vast. This is one aspect of the profession that Nick appreciated more once he’d started his career at Clifford Chance. “At university, you have the luxury of choosing specific modules based on your interests but that doesn’t necessarily demonstrate the full variety and breadth of law on offer”, he explains. Being a tax lawyer doesn’t necessarily mean “being an expert in all tax laws” because the area of tax law is so wide itself. He encourages those interested in the profession to have an “appreciation ” of the industry’s depth as it’ll help to guide you through the process as you identify the area of law for you. This moment might not come until the end of your training contract, or even beyond that.