Category Archives: Misc

NEWS – TUESDAY 13TH APRIL 2021


NEWS – TUESDAY 13TH APRIL 2021

NEWS ROUNDUP

TAX NEWS – TUESDAY 13TH APRIL 2021

American CEOs say Biden’s tax hikes will slash wages, hiring and profits

A majority of CEOs in the US have said the Biden administration’s plans to hike corporation tax from 21% to 28% would have a “moderately” to “very” significant adverse effect on their company’s competitiveness. A Business Roundtable Survey found 98% of American CEOs believe the rate increase will stunt wage growth, weaken expansion, innovation and hiring. Raytheon Technologies CEO Gregory Hayes said: “The tax system needs to support innovation, R&D, capital investment and economic growth.” He continued: “As we look toward recovering from the COVID-19 pandemic, keeping competitive tax policies in place is needed to help reinvigorate the U.S. economy and lead to more opportunity for Americans.” Meanwhile, writing in the FT, Richard Murphy says Biden’s plan for international tax reform would need robust country-by-country reporting if it’s to stop international tax arbitrage. Finally, Conservative MP Sir John Redwood has warned that a new global minimum corporation tax rate of 21% would seriously harm investment flows into Ireland, which has used a 12.5% tax rate to build its economy.

Financial Times Daily Express Daily Mail

UN chief calls for wealth tax on rich boosted by pandemic

United Nations secretary-general Antonio Guterres has urged governments to impose a “solidarity or wealth tax” on rich people who profited during the coronavirus pandemic. “We must make sure funds go where they are needed most. Latest reports indicate that there has been a $5trn surge in the wealth of the world’s richest in the past year,” Guterres told a UN meeting on financing for development. “I urge governments to consider a solidarity or wealth tax on those who have profited during the pandemic, to reduce extreme inequalities,” he added. The call from Guterres follows a similar plea from the International Monetary Fund which has advocated a “temporary COVID-19 recovery contribution” to be levied on those companies and individuals that have benefited financially during the pandemic.

City AM Daily Mail The Independent

SMEs NEWS – TUESDAY 13TH APRIL 2021

City to boost Square Mile’s recovery with fund for SMEs

Catherine McGuinness, Policy Chair of the City of London Corporation, details in a piece for City AM a new Covid Business Recovery Fund to help underpin the Square Mile’s economic recovery. “The scheme is designed to support SME businesses which contribute to the Square Mile’s vibrancy at street level and directly provide services to returning City workers, visitors and residents.” McGuinness adds that most workers are keen to return to the Square Mile while City leaders have stressed their commitment to central London office space. She concludes: “The vibrancy of our unique ecosystem relies on each part of the City community – multinational businesses to domestic SMEs, international workers to local residents – working in partnership. Together we can bring back the buzz of life in the Square Mile.”

City AM

SMEs should use delays to customs changes to implement new systems

Experts are warning Britain’s small businesses to get systems in place so they can export smoothly to the EU whilst the rollout of new border procedures are delayed. Management consultant Neil McEvoy said: “Businesses need systems in place that provide scheduling and planning tools, in order to ensure every shipment is compliant when sent to the EU.” He added: “If SMEs get their selling systems ready for May they will survive, because Europe offers ‘low-hanging fruit’, with lots of people looking to spend. There will be many businesses that don’t and they will go to the wall. For those that get it right, the market is huge.”

The Loadstar

PENSIONS NEWS – TUESDAY 13TH APRIL 2021

Pandemic fuels ‘all-or-nothing’ retirement plans

Research from Hargreaves Lansdown shows the gap in peoples’ retirement plans has widened as a result of the COVID-19 pandemic. The investment platform found the number of people who wanted to give up work between the age of 50 and state pension age had more than doubled from 4% before the pandemic to 10% after. Conversely, for those that wanted to carry on working full time, the figure increased from 38% to 42%. Hargreaves’ Sarah Coles said the pandemic had forced people to make decisions about their retirement. “While a fifth of people still plan to gradually ease out of the workplace, it has fuelled a rise in all-or-nothing retirement plans,” she said. Meanwhile, Darren Dicks, head of wealth management at Age Partnership, said: “Since February we have seen a marked increase in the volume of clients getting their retirement plans back on track.”

Daily Express Investors’ Chronicle FT Adviser Pensions Age

Cost risk for NHS if retirement age extended

A study of more than 7,000 women aged 55 to 65 out of King’s College London warns that raising the retirement age as a means to reduce pension costs would mean a reduction in in-family care resulting in more pressure on the NHS. Research fellow Ludovico Carrino said longer working hours cut the probability of women providing “intensive” or “meaningful” care and urged officials not to consider policies in institutional silos. Sir Steve Webb, former pensions minister and partner at consultants LCP, said: “If governments are going to raise pension ages, much more needs to be done to support people who will be working longer as a result.” The Telegraph notes that the state pension age for men and women will rise to 67 by 2028 with recent increases saving the Government billions of pounds every year.

The Daily Telegraph

CORPORATE NEWS – TUESDAY 13TH APRIL 2021

Liberty Steel misses filing deadlines

Liberty Steel has failed to file accounts for some of its biggest British businesses in time. Sanjeev Gupta is urgently seeking finance to shore up his industrial empire after its main backer, Greensill Capital went bust. Credit Suisse, a lender to Greensill, is trying to recover money lent to Gupta’s companies via court action in the UK and Australia. An insider said most of the companies had not filed audited accounts for the year ending on 31 March 2020 because they would no longer represent an up-to-date view of the businesses.

The Guardian, Page: 26

Taxpayers on the hook for Monarch airlift

papers released by KPMG show Greybull, the owner of collapsed budget airline Monarch, lost £25m from the administration process, which was completed last month. The Civil Aviation Authority was forced to charter planes to fly customers back to the UK after Monarch went bust in 2017 and it was hoped some of the costs of the airlift could have been recouped, but tax payers will have to foot the entire £60m bill.

Daily Mail, Page: 79

ECONOMY NEWS – TUESDAY 13TH APRIL 2021

North West business leaders optimistic

With coronavirus restrictions lifting across the country allowing hospitality and non-essential retail to open up again, leaders from across the North West are looking ahead with optimism. Neil Sturmey, a senior partner at Grant Thornton in the North West, noted that it had been “the longest winter” for high street retailers and the hospitality sector, with both “overdue some good news”. “That is coming,” he said. “Most of us are desperate to go out again and many businesses are hoping that we are heading for a golden summer.”

Insider Media

OTHER NEWS – TUESDAY 13TH APRIL 2021

KPMG UK appoints new chief executive

Jon Holt has been voted in as KPMG UK’s new chief executive with partners overwhelmingly backing the appointment, although he was the only candidate put forward by the board. The vacancy was created by the resignation by Bill Michael as chair and chief executive after a staff backlash in February over comments he made at a virtual town hall meeting. Mary O’Connor, who took over the day-to-day running of KPMG on an interim basis after Michael left, will now step aside. The firm’s chair Bina Mehta commented: “I’m delighted that Jon received the overwhelming backing of the partnership. Jon’s extensive experience and inclusive leadership style means he is well placed to deliver the next stage of our growth strategy and support our clients as the country emerges from the pandemic.”

Financial Times, Page: 12 The Daily Telegraph The Times, Page: 40 City AM Daily Mail, Page: 79 The I, Page: 44

City executive justly fired

An associate director at investment management company Smith & Williamson Corporate Services was sacked fairly, a tribunal has heard, after he gave a colleague a “seven out of ten” rating on a night out. Tom Skinner asked his junior colleague Jessica Lennox what would happen if they were the last people left alive and had to “repopulate the Earth.” During the same evening, he also made inappropriate comments to a woman named as ‘Ms J’ and twice followed her into the toilet and refused to leave. After he was sacked for gross misconduct, he launched an unfair dismissal claim, saying he had been discriminated against because he suffered from anxiety. His case was dismissed by a central London tribunal that ruled his “inappropriate behaviour” meant his sacking was justified.

The Times, Page: 18 The Daily Telegraph, Page: 13 Daily Mail, Page: 32 Daily Star, Page: 15 Daily Express, Page: 21

Contact Paul Southward

Paul Southward


NEWS – FRIDAY 26TH MARCH 2021


NEWS – FRIDAY 26TH MARCH 2021

NEWS ROUNDUP

TAX NEWS – FRIDAY 26TH MARCH 2021

Rishi Sunak’s ‘super-deduction’ will benefit London twice as much as Yorkshire

A new report says the Government’s economic recovery policies will benefit the capital over the rest of the UK. The Centre for Progressive Policy (CPP) estimates that the ‘super-deduction’, which allows firms to claim a deduction from their tax bill if they invest in new equipment for their business, offers the greatest advantage to London – leading to a tax break per head of £512.89 in the capital but just £276.14 in Yorkshire and the Humber. Ben Franklin, Head of Research at CPP, says its analysis suggests the Government “has either failed to grasp the nature, scale and urgency of inclusive recovery or has given up on its own levelling up agenda.” A Treasury spokesman said: “We are totally committed to levelling up communities across the whole of the UK as we build back better.”

Yorkshire Post

Labour to propose tax raid on Scotland’s high earners

The Labour party’s Scottish leader has indicated that he is in favour of a tax raid on high earners as the Holyrood elections loom. Anas Sarwar said that while full details of his policy would be unveiled in the party’s manifesto, he supported a “more progressive tax system” to better fund public services. The Telegraph notes that during the campaign for the Scottish Labour leadership, Mr Sarwar suggested a 5% tax rise for those earning more than £150,000 a year and 2% hike for those on salaries of more than £100,000. Separately, a study by the TaxPayers’ Alliance found an independent Scotland would need to more than double the basic rate of income tax to balance its books.

The Daily Telegraph Daily Express

Self-employed urged to appeal HMRC penalties as tax deadline nears

The Express reports on the recent announcement from HMRC that it would delay imposing penalties for the late payment of self-assessment tax by one month to April 1 to help those whose finances have been affected by the pandemic. Additionally, late payments for outstanding tax bills which are charged six and 12 months after the deadline have also been pushed back to August 2021 and February 2022 respectively. However, people with an outstanding tax bill have been incurring interest of 2.6% since the January 31 self-assessment deadline expired, according to analysis from UHY Hacker Young. Partner Graham Boar urges those yet to pay to note the deadline and reassures those incorrectly charged with a penalty: “HMRC has proven that it will hold its hands up if it’s made a mistake.”

Daily Express

British expats resident in Italy face steep rise in wealth tax bills

Britons resident in Italy face tenfold increases in overseas property duties under post-Brexit rule changes. Now that Britain is longer part of the EU, Italy’s 0.76% annual levy on the value of overseas properties will now be based on the current market value rather than calculated using council tax valuations dating back to the early 1990s. This means a property valued at £240,000 in 1991 but worth £3m now will produce a wealth tax bill of more than £20,000, compared to less than £2,000 before.

The Daily Telegraph

CORPORATE NEWS – FRIDAY 26TH MARCH 2021

KPMG hired to check coronavirus loans

The Government has brought in KPMG to check over billions of pounds of government-backed loans to ensure that lenders have complied with the rules. The move comes after it emerged that Greensill, a collapsed supply chain financier accredited for two of the schemes, may have the Government guarantee on £400m of loans removed. Separately, Labour is calling on the Cabinet Secretary to investigate “serious concerns” about David Cameron’s efforts to lobby Whitehall officials on behalf of the collapsed lender.

The Times, Page: 40 The Guardian, Page: 33

UK bosses to invest in more sustainable initiatives

A PwC survey of UK chief executives reveals 70% are concerned about the impact of climate change, with almost a third “extremely concerned” about the issue. “Climate has become a fundamental business issue, and CEOs recognise they need to step up. Companies are starting to transform their business models, supply chains, products and services,” Kevin Ellis, PwC’s chairman and senior partner said. Some 60% of leaders plan to increase their investment in ESG initiatives over the next three years.

City AM

SMEs NEWS – FRIDAY 26TH MARCH 2021

COVID-19 lending schemes back over 1.6m businesses

HM Treasury figures show over 1.6m UK businesses borrowed more than £75bn through government-backed coronavirus lending schemes in the last year. The Bounce Back Scheme was accessed by more than 1.5m firms; the Coronavirus Business Interruption Loan Scheme (CBILS) has provided £23.3bn in financial support to more than 98,000 businesses; and £5.3bn in lending has been provided to 716 businesses through the Coronavirus Large Business Interruption Loan Scheme (CLBILS). Meanwhile, the British Chambers of Commerce has alerted Downing Street to the high levels of debt taken on by businesses, with a recent poll finding more than a quarter described debts as unmanageable or “high and manageable”.

Financial Times Business Money P2P Finance News

Sunak planning to hit self-employed with tax hike

The i reports that Treasury sources have indicated the Chancellor “is minded” to bring NICs for self-employed in line with payments made by employed staff. They said: “The Chancellor believes tax and National Insurance payments should be fair for all earners, and levelling up the National Insurance bands is being considered as one way of doing that.” Nimesh Shah, a partner Blick Rothenberg, suggested Rishi Sunak could make the change in his Autumn Statement, noting that the Government “has not been particularly sympathetic to the self-employed community. In recent years, successive governments have made no secret of their desire to increase taxes for the self-employed.”

The i, Page: 10

PROPERTY NEWS – FRIDAY 26TH MARCH 2021

Government sets aside £1.5bn of support as rates relief appeals denied

Thousands of companies are set to be refused business rates relief after the Treasury said it will legislate to “rule out” Covid-related business rates appeals. Instead the Government will provide a new £1.5bn pot of funding that will be distributed to sectors which have “suffered most economically” outside the retail, hospitality, and leisure sectors. The fund will be administered by local authorities, which will decide whether a business is eligible, and priority will be given to the worst-affected sectors.

Financial Times BBC News Daily Mail The Guardian

ECONOMY NEWS – FRIDAY 26TH MARCH 2021

EY warns of ‘financial cliff edge’ threatening listed British firms

Analysis by EY shows that between March 2020 and March this year, 63 UK listed companies issued at least their third profit warning within a 12-month period, which is almost double the 2019 total of 32. As many as one in five of these companies is likely to collapse into the hands of administrators within a year of the third warning. Once taxpayer-backed Government support comes to an end, the companies in jeopardy could face a “financial cliff edge,” EY warned.

Daily Mail

INDUSTRY NEWS – FRIDAY 26TH MARCH 2021

Richard Houston: Significant audit reforms crucial for investor confidence in UK

Writing in City AM, the CEO and senior partner of Deloitte, Richard Houston, contends that the UK puts at risk its standing as a leading place to invest and do business if there are further delays to audit and corporate governance reforms. The Department for Business, Energy & Industrial Strategy (BEIS) recently published a consultation on Restoring Trust in Audit and Corporate Governance and the challenges facing Britain today are precisely why this is the right time to strengthen the system, Houston says, rather than using those hurdles as an excuse for putting reform off. “Change isn’t always easy. But the damage that corporate failures can inflict means that we, and all stakeholders, have a responsibility to ensure that whatever change lies ahead improves the quality, transparency and resilience of UK capital markets and generates greater trust in business.”

City AM

Sir Jon Thompson: Neds don’t get a free pass

The head of the Financial Reporting Council told an industry forum on Thursday that senior non-executive directors had complained about governance reforms that will see directors held responsible for a company’s accounts. Sir Jon Thompson said non-executive directors who did not believe they were responsible for running a company couldn’t pass the buck. He told an online event hosted by the ICAEW: “In law, you all run the company. You can’t simply turn up, take your fee, not do anything and say, ‘Well, it’s the chief executive’s fault.’ If you’re on the board, you’re on the audit committee, you have to take responsibility for the fact you’ve got obligations to the people who are investing in your company, or investing their pension money in your company.” The Times cites Roger Barker, head of policy at the Institute of Directors, who warns that if regulations are too heavy-handed then bosses will not have enough left to strategise.

The Times, Page: 39

OTHER NEWS – FRIDAY 26TH MARCH 2021

Good Law Project finds Deloitte drafted parliamentary answers

Figures from the Good Law Project show that Deloitte has been awarded public sector contracts worth £323m since the start of the pandemic. The Government has been using Deloitte to help ministers draft parliamentary questions and media lines to defend the ‘test and trace’ system. Good Law Project legal director Gemma Abbott commented: “We have a government so addicted to outsourcing that it has even outsourced being held to account. Does anyone know where the Department for Deloitte ends and the Department for Health begins?”. A Department of Health and Social Care spokesperson responded: “The Government employs contractors in the same vein that private businesses do and responsibility for answering parliamentary questions, freedom of information requests and media enquiries rests firmly with a team of civil service communications professionals within the Department of Health and Social Care,” ; continuing: “Every single response is subject to the highest levels of scrutiny to ensure they are both factual and detailed.”

City AM

Contact Paul Southward

Paul Southward


NEWS – TUESDAY 23RD FEBRUARY 2021


NEWS – TUESDAY 23RD FEBRUARY 2021

NEWS ROUNDUP

TAX NEWS – TUESDAY 23RD FEBRUARY 2021

Chancellor can raise funds without disrupting economy

The Times’ Philip Aldrick contends that Rishi Sunak can still raise taxes in his Budget but this does not mean he has to take money out of the economy, which most analysts agree is not the right thing to do at this point. Aldrick suggests offsetting a rise in corporation tax or a new online sales tax with investment inducements or a reduction in rates for high street retailers, arguing that such measures would support growth and do not constitute fiscal tightening. Additionally, prudence calls for the country’s debt to be acknowledged, and paying that down while rates are so low is not a bad idea.

The Times, Page: 35

File tax returns now to prevent penalties

HMRC is urging self-assessment taxpayers to submit their late tax returns by 28th February of face a £100 late filing penalty. While 10.7m taxpayers filed their return by 31 January, more than 1.5m taxpayers missed this deadline and are still to file their tax return. They are accruing interest on any unpaid tax liabilities but still have time to file and pay without incurring penalty charges. Those who owe tax have until midnight on 1st April to pay any outstanding tax or set up a payment plan to prevent a 5% late payment penalty.

Press Release Daily Express

London’s super-rich gain more than all of north of England

Campaign group Tax Justice UK says figures from HMRC show a group of 1,600 ultra-wealthy Londoners made £9bn from assets in 2019, more than the entire population of the north of England, which made £8bn. Tax Justice said that the figures underscored the need for the government to equalise capital gains and income tax rates.

The Times

Tax havens tycoons could lose their knighthoods

A Cabinet Office spokeswoman has denied claims reported by the Times that the honours committee has created a “Ratcliffe clause” allowing for knighthoods to be withdrawn if the recipient moves abroad to avoid taxation. The rule allegedly refers to Sir Jim Ratcliffe, the billionaire Ineos boss who moved to Monaco after receiving a knighthood for services to business.

The Times, Page: 4

ESG investment favours tax-avoiding tech companies

The rise in ESG-based investing is funnelling money into companies that pay much less tax and employ fewer people than their lower-rated peers, experts say, with ESG funds unconsciously “worsening inequality and monopolistic concentration”.

Financial Times

Online sales tax proposal leaves sector opinion split

Calculations by the FT indicate that leading UK high street retailers face potentially higher taxes if the Government imposes a charge on online sales to fund a reduction in business rates.

Financial Times, Page: 12

REPORTING NEWS – TUESDAY 23RD FEBRUARY 2021

Companies given six-month reprieve on gender pay gap reporting

The Equality and Human Rights Commission (EHRC) has given UK companies a six month grace period to report their gender pay gap. The EHRC confirmed it would not begin enforcement proceedings until 4th October. Kishwer Falkner, the EHRC chair, said the approach was designed to strike “the right balance between supporting businesses still impacted by the pandemic and making sure employers comply with the law”. Felicia Willow, the chief executive of the Fawcett Society, welcomed the news that companies would have to report their gender pay gaps for 2020-21. She said: “We recognise that the pandemic has affected many employers, but gender pay gap reporting is good for business. We therefore hope that there will be no further delays in enforcement after this year.”

The Guardian

UK companies face greater scrutiny on climate risks at upcoming AGMs

The Investment Association will start flagging companies in high-risk sectors which fail to report on climate-related risks. The IA’s Andrew Ninian states that clear reporting is vital to achieve a more sustainable future.

Financial Times

EMPLOYMENT NEWS – TUESDAY 23RD FEBRUARY 2021

Firms urged to consider “psychological safety” of staff

The Financial Conduct Authority has warned that workers in the financial services sector are suffering from “lockdown fatigue”, with high performers given huge workloads. Bosses are being urged to consider “psychological safety”, or ensuring that all employees feel confident about speaking out and challenging opinions. David Blunt, the FCA’s head of conduct specialists, said at an online conference: “During this third lockdown, there has been a greater impact on mental wellbeing, with many people struggling with job security, caring responsibilities, home schooling, bereavements and lockdown fatigue.” He added: “The impact of COVID-19 is creating a huge workload for those considered to be high performers, while the remote environment potentially makes it much more challenging for those who were previously considered low performers to change that perception.”

The Times, Page: 34 The I, Page: 42

Gig economy workers to capture 20% of financial services jobs

According to research from PwC, gig economy workers will soon make up between 15 and 20% of the workforce at financial services firms, with the change driven by cost pressure and the need to access digitally skilled talent. John Garvey, PwC global financial services leader at PwC US, said: “Leaders in the industry are looking seriously at their workforces to evaluate which roles need to be performed by permanent employees and which can be performed by gig-economy workers, contractors or even crowd-sourced on a case-by-case basis.” Garvey added that remote working has enabled firms to assess outside of a firm’s physical location, including outside the country.

City AM

Doubts staff will flood back to offices post-lockdown

With Boris Johnson outlining his plans to ease Britain out of the pandemic lockdown the Telegraph notes that people working from home will not be back in the office before June 21st. A KPMG survey reveals that a quarter of financial services staff would like to remain working from home full-time even after restrictions are lifted. KPMG is one of a swathe of firms redesigning its offices to prioritise meeting spaces and video technology over the banks of desks that traditionally dominated City offices, the paper adds, while PwC is investing in virtual reality headsets to make video meetings more enjoyable.

The Daily Telegraph, Business, Page: 3

REGULATION NEWS – TUESDAY 23RD FEBRUARY 2021

Changes to solvency rules could free up £9bn

A report written by KPMG and commissioned by the Association of British Insurers argues that loosening the EU’s Solvency II regulations post-Brexit and giving them more freedom over how they invest their assets could free up £95bn for City insurance firms to reinvest into the economy. KPMG said the formula that determines the cap on how much capital insurance firms must hold at any one time to stave off insolvency “is overly-sensitive to very low interest rates” and that it forces “insurers to hold billions of excess capital for no purpose”.

The Times, Page: 37 Financial Times, Page: 2 The Daily Telegraph, Business, Page: 2 City AM

SMEs NEWS – TUESDAY 23RD FEBRUARY 2021

Letter: SMEs deserve the tax relief, not private equity

Phillip Oppenheim says tax reliefs for investors should not be stripped away from entrepreneurs who take great risks. He suggests the tax treatment of carried interest for private equity should be targeted instead.

Financial Times, Page: 22

PROPERTY NEWS – TUESDAY 23RD FEBRUARY 2021

Stamp duty holiday saves movers £11,500

Research by Halifax shows the stamp duty holiday has saved the average house mover £11,566 in tax as well as boosting property prices by 15.5%. Movers in England and Wales spent an average £431,000 per property in the six months to December last year, a rise of nearly £58,000.

The Daily Telegraph, Business, Page: 1

ECONOMY NEWS – TUESDAY 23RD FEBRUARY 2021

Economists voice concern over rise in inflation

The Times reports on concerns among investors that as countries emerge from the pandemic lockdowns economies will overheat and inflation will run rampant, causing central banks to turn off the taps and tighten monetary policy. George Lagarias, chief economist at Mazars, said: “We know that market performance is still driven by exceptional monetary stimulus. Accommodation will most probably remain elevated for the year, but 2021 will challenge the iron resolve of central bankers, as inflation figures are expected to materially climb. While we believe that this inflation will probably be transitory, a result of supply chain pressures, stimulus and mere year-on-year consumer price comparison (against the horrid second quarter of 2020), we need to remain vigilant in case it overshoots or overextends its welcome.”

The Times, Page: 25

OTHER NEWS – TUESDAY 23RD FEBRUARY 2021

US Supreme Court allows prosecutor to obtain Trump tax records

The US supreme court has ordered Donald Trump to hand over his tax returns to Manhattan District Attorney Cyrus Vance Jr., who has been seeking Mr Trump’s tax records since 2019. The ruling could mean a grand jury investigation into alleged hush money payments and other transactions. The former President’s accounting firm, Mazars, said it would comply with the subpoena, but Mr Trump sued to block the records’ release. Mr Trump claims the DA’s efforts to obtain his tax returns is the “greatest political Witch Hunt in the history of our Country.”

Financial Times The Daily Telegraph, Page: 15 BBC News Metro

Contact Paul Southward

Paul Southward


NEWS – MONDAY 25TH JANUARY 2021


NEWS – MONDAY 25TH JANUARY 2021

NEWS ROUNDUP

TAX NEWS – MONDAY 25TH JANUARY 2021

Green investments should earn firms tax breaks

Companies investing in green technology should be eligible for tax breaks, EY’s former UK boss Steve Varley has said. Mr Varley suggested taxation could play a role in the Government’s efforts to end the UK’s contribution to global warming by 2050. He said: “In the past the UK… had incentives for research and development innovation. I think exploring those and reintroducing those at a greater scale to spur on green investments and green technology would be a really smart avenue for the Treasury.” The Telegraph points out that demand for consultants with expertise on reducing emissions is booming with companies keen for talent to help them reduce their carbon footprint.

The Daily Telegraph, Business, Page: 3

Doctors fighting Covid refuse extra shifts due to tax penalties

The Telegraph reports that doctors working overtime to fight the pandemic still face hefty tax bills due to the “tapered” annual allowance for pensions, leading many to refuse extra shifts. The NHS Pensions Scheme has previously extended a deadline to allow staff to cover tax bills using their retirement pots, known as “scheme pays”, to March 2021 for the 2018/19 tax year. But Rachael Hall, of adviser Sandringham Medical, said: “There is a clear mistake in people thinking the problem has gone away because the threshold of the taper was increased. Tapering thresholds have been extended but a £40,000 annual allowance still applies and some members will always exceed this level from one year to the next.”

The Daily Telegraph

Taxpayers told to query deadline fines

Accountants are urging taxpayers who receive penalties after the 31 January self-assessment tax deadline to appeal if they believe the fines were wrongly imposed. Data provided by HMRC to UHY Hacker Young shows that of £275m in penalties imposed for late payment, £167m was later cancelled. The firm also pointed out HMRC’s more understanding approach towards late filing suggests this may also be the case with the late payment of tax.

The I, Page: 45 Daily Express

It is not the time for Britain to raise taxes

An FT editorial says that Britain does not need to have taxes tinkered with at the moment, arguing that a broader look at taxation is called for, but this can wait for another day.

Financial Times, Page: 22

EMPLOYMENT NEWS – MONDAY 25TH JANUARY 2021

Calls for work placement programme to be extended

The UK Government’s Kickstart scheme, which offers paid six-month placements to 16 to 24-year-olds claiming universal credit, should be extended into 2022 in order to curb a rise in long-term unemployment for young people. The £2bn scheme launched last July pays employers £1,500 per post and then covers 100% of the minimum wage for 25 hours a week for a total of six months. The scheme is set to close to new applications at the end of the year. Tony Wilson, director of the Institute for Employment Studies, said: “The Government needs to extend it by at least another six months in my view – not least because the peak of long-term unemployment for young people may well be in 2022 rather than 2021.” Meanwhile, the FT reports that the Government is making it easier for small businesses to apply to the scheme.

The Daily Telegraph Financial Times Financial Times, Page: 2

Britain’s low-earners fall foul of rules on self-isolation

Studies provided to the UK Government show low earners are less likely to self-isolate after coming into contact with COVID-19, leading to calls for better financial support for this group.

Financial Times

PROPERTY NEWS – MONDAY 25TH JANUARY 2021

Foreign demand remains for prime sites in the capital

International investment into commercial property in London is holding up well following an “horrific” period following the start of the pandemic with Q4 investment standing at about £5bn – roughly bang on the same number for Q4 each of the last three years, according to Mat Oakley at Savills. Kelly Cleveland, head of investment for British Land, adds that a “wall of capital” is waiting to deploy into London hinting at a rapid recovery once the Covid threat is lifted. With other sectors – retail and hospitality – remaining effectively uninvestable, offices and residential remain attractive especially given the lack of inflation of office rents due to Brexit, even if workers aren’t returning yet.

The Daily Telegraph

INVESTMENT NEWS – MONDAY 25TH JANUARY 2021

Bank of England warned over climate change investments

MPs have warned the Bank of England that it risks creating a “moral hazard” if it continues to buy bonds from companies with high emissions. Philip Dunne, who chairs the Environmental Audit Committee, has written to BoE Governor Andrew Bailey and said its rapid response to COVID-19 was “admirable”. However, he warned that the central bank’s actions were not lining up with global ambitions to limit climate change to 1.5C, as in the Paris Agreement, or the UK’s hopes to slash its emissions to “net zero” by 2050. Mr Dunne also called on the Bank to require companies getting taxpayer support through the Covid Corporate Financing Facility to publish climate-related financial disclosures. The Bank of England said in response “work to consider how best to take account of climate considerations in our corporate bond portfolio is already under way” and that climate change is a “strategic   priority ”.

Financial Times The Independent Daily Express

INDUSTRY NEWS – MONDAY 25TH JANUARY 2021

Tech frees finance chiefs for broader roles

The FT reports on how digital transformation has meant the skills companies are looking for in a finance chief have changed, with automation freeing CFOs up to work more strategically.

Financial Times, Corporate Change and Technology

CORPORATE NEWS – MONDAY 25TH JANUARY 2021

Boohoo set to acquire Debenhams brand

The acquisition of the Debenhams brand by fast fashion retailer Boohoo is expected to be announced in the next few days. Sources say the cut-price deal will result in the closure of the group’s remaining department stores.

Financial Times

ECONOMY NEWS – MONDAY 25TH JANUARY 2021

Record redundancies planned last year

Data obtained from the Insolvency Service shows that despite the Government’s furlough scheme, British employers made plans to cut 795,000 jobs last year, a record number. More than 10,000 firms planned job cuts, however the pace of planned cuts slowed at the end of the year. Last month employers notified Government of plans to cut 23,100 job cuts, which is the lowest monthly figure for 2020, though still a third higher than December 2019. Employers must notify the Insolvency Service when they plan to cut 20 or more jobs. The number of job cuts proposed through the year was well above the 530,000 seen the last time the UK was in recession, in 2010, and higher than any year in the records which go back to 2006.

BBC News

Hedge fund Element warns of deep economic blow from new virus strain

The head of markets at Element Capital, Colin Teichholtz, has warned that the impact of the new Covid strain on the European economy is being underestimated by investors and policymakers.

Financial Times

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Paul Southward


NEWS – WEEKEND TO 13TH DECEMBER 2020


NEWS – WEEKEND TO 13TH DECEMBER 2020

NEWS ROUNDUP

TAX NEWS – WEEKEND TO 13TH DECEMBER 2020

SATURDAY

One in four Brits would flee wealth tax rather than pay

Responding to the Wealth Tax Commission’s proposals for a one-off 5% tax on those with assets worth over £500k, over a quarter of Telegraph readers say they will leave the country if it is imposed. In the FT, Richard Jameson, partner at Saffery Champness, says: “It is widely acknowledged that tax rises are going to play a part in rebuilding the public finances following the COVID-19 crisis.” Jo Bateson, partner at KPMG, warns that without relief on business assets, the tax would have “implications for investment and growth.”

The Daily Telegraph, Page: 3 Financial Times, Page: 3

John Redwood: “Bring on more Freeports!”

Conservative MP John Redwood has called for freeport plans to be ramped up as a no-deal Brexit looks increasingly likely. He said: “We need new areas freed of restrictions to enterprise and with low taxes to harness the UK’s potential as a trading and manufacturing nation. Let’s add more value to raw materials and components we import by building factories close to ports and using our natural advantages as a global trading nation. Let’s for example have more fish processing and meal preparation next to our fishing ports.”

Daily Express

Letter: Let’s not vilify HMRC too quickly

HMRC’s press officer from 2018-2020, Thomas Riley, sympathises with people being chased for tax despite them struggling under the strain of the pandemic. But he says for all the “emotional unintelligence” at the department, there are thousands of civil servants “going beyond the call of duty to help.” He concludes: “Although HMRC must be held to the highest standards, we should not always be so quick to cast it as a villain. Tax is fundamental to our society, and HMRC needs to collect it.”

The Times, Page: 38

SUNDAY

Retirees with final salary pensions could be hit by wealth tax

A new wealth tax could hit people with final salary pensions, according to NFU Mutual, which warned that even modest defined benefit pensions could be hit with tax bills. The proposed one-off tax on assets exceeding £500,000 includes pensions, and if the “cash equivalent transfer value” of a pension was used to calculate pension wealth, a pension that pays out £10,000 a year could be worth as much as £330,000, easily pushing savers who own a property over the £500,000 threshold. NFU Mutual’s Sean McCann said there would be unintended victims of including pensions in the assessment of an individual’s wealth. Mike Hodges, of Saffery Champness, said the tax was “fraught with the danger of getting it wrong at the expense of people’s pensions”. He said: “The Government clearly needs to raise money now but imposing a wealth tax that will only pay out in future decades when people retire is not an answer to today’s problem.” An editorial in the Observer and Carol Lewis in the Sunday Times both say the plans will be difficult to swallow – and perhaps harder to get past voters.

The Sunday Telegraph, Business, Page: 9 The Observer, Page: 66 The Sunday Times, Page: 2, 3

INDUSTRY NEWS – WEEKEND TO 13TH DECEMBER 2020

SUNDAY

Interview: Tim Martin

The Sunday Telegraph talks to Wetherspoon’s boss Tim Martin, who seems to have been pondering the issue of succession after a year of “absolute hell”. “I’m worried about who might take over because corporate governance rules guarantee eventual mediocrity or failure by sweeping away the mechanism by which the company is run,” he says. The Financial Reporting Council’s corporate governance code deems that a chairman is no longer independent after nine years in the role, and Martin has held the position since 1983. Martin continues: “A very good pub company or retailer has got to where it’s got to because of the culture. If you lose the culture you lose the business. Since the introduction of the current corporate governance regime, I don’t think there’s a single example of PLC that has over the last 30 years gone from strength to strength. It destroyed the supermarkets – Tesco, Sainsbury’s – when they ran them on a revolving door CEO basis, with revolving door non-execs; it hasn’t worked.”

The Sunday Telegraph, Business, Page: 7

CORPORATE NEWS – WEEKEND TO 13TH DECEMBER 2020

SATURDAY

Mastercard back on the hook for fees

The Supreme Court has ruled that a landmark class action claim against Mastercard could be heard again after it was rejected three years ago. Mastercard is alleged to have forced shoppers to pay higher prices through fees that it charged merchants in the 16 years to 2008. If the company loses, it could be forced to pay consumers a total of £14bn. Rocio Concha, a director at the campaign group Which?, said: “This is a hugely important win for consumers.”

The Times, Page: 11 The Guardian, Page: 44

Tourist tax would cost 2,000 jobs at Heathrow

Some 2,000 jobs at Heathrow could be lost as a result of the Government’s decision to end tax-free shopping for tourists, according to the airport’s chief executive. John Holland-Kaye said the move could be the “final nail in the coffin” for many struggling businesses.

The Guardian, Page: 45 Daily Mail, Page: 95

SUNDAY

US retail powerhouse targets Arcadia and Debenhams

Debenhams and Arcadia Group could both be taken over by the American retail giant Authentic Brands which is in discussions with the administrators of both companies, the Sunday Telegraph reports. Deloitte is running an auction of Sir Philip Green’s Arcadia empire under the codename Project Kane. Authentic chairman Jamie Salter has built up a reserve of more than $1bn during the pandemic and is backed by investors including Blackrock and Leonard Green & Partners. Authentic has already bought out bankrupt US retailers including Barneys and Forever 21, among others, and is involved in an attempted turnaround of the department store chain JC Penney. Associated British Foods, Marks & Spencer, Next and River Island are also sizing up bids for Arcadia brands.

The Sunday Telegraph, Business, Page: 1 The Sunday Times, Business, Page: 1 The Mail on Sunday, Page: 121

SMEs NEWS – WEEKEND TO 13TH DECEMBER 2020

SUNDAY

Premium hikes threaten small businesses

Research by the consultant Mactavish shows that some insurance premiums for SMEs have risen by 800% this year leading to fears that some businesses will not be able to afford to renew their policies. Chief executive Bruce Hepburn warned: “The timing couldn’t be worse for firms still being battered by the economic fall-out from the pandemic. For some SMEs, these unexpected cost increases could be the final nail in the coffin.” Meanwhile, a judgement from the Supreme Court on whether insurers should honour coronavirus claims made by SME customers on their business interruption policies could be issued before Christmas, affecting some 370,000 businesses.

Sunday Express, Page: 51

Lloyds joins NatWest and unblocks business account applications

Lloyds Bank and NatWest have opened up business account applications again after joining other big banks in blocking them due to high demand from customers seeking emergency bounce back loans and a massive rise in fraudulent applications. MPs on the Treasury committee will tomorrow grill senior bankers from NatWest, HSBC and Lloyds on why they blocked small firms. David Clarke, chairman of the Fraud Advisory Panel charity, said: “This is a business decision by the banks.” Fraud checks can be done “in 15 minutes.”

The Mail on Sunday, Page: 122

Three-quarters now spend more at local businesses

A survey by Nucleus Commercial Finance has found that 71% of shoppers are intentionally spending more money at local businesses due to the pandemic than they did last year, with 14% saying they have spent significantly more. Small businesses are recognising the change too, with 42% saying they feel better supported by locals since the pandemic began.

Sunday Express, Page: 52

EMPLOYMENT NEWS – WEEKEND TO 13TH DECEMBER 2020

SUNDAY

Unemployment rate expected to stand at 5.1%

Data from the Office for National Statistics will on Tuesday show the unemployment rate rose and the number of people in work fell due to the unwinding of furlough in October. The furlough scheme was expected to end on October 31st, but the Chancellor extended it to the end of March. The ONS is expected to say the unemployment rate rose from 4.8% to 5.1% while the number of job losses rose from 164,000 to 250,000.

Sunday Express, Page: 52

PROPERTY NEWS – WEEKEND TO 13TH DECEMBER 2020

SATURDAY

London faces “brain drain” hitting salaries, rents and house prices

Wages, rents and house prices could fall in London as white-collar workers choose to relocate elsewhere because of the pandemic. Paul Swinney, of think tank Centre for Cities, says the exodus will almost certainly mean a fall in salaries in the capital if employees no longer have to live near their work. The number of Londoners wanting to buy a home outside the city was 27% higher between May and October compared with the same period in 2019, according to Hamptons International. Demand for homes worth £1m or more was up by 86%. The Telegraph suggests London’s experience echoes that of San Francisco, which was already facing something of a brain drain pre-Covid because of its extortionately high living costs and taxes.

The Daily Telegraph, Page: 4

PENSIONS NEWS – WEEKEND TO 13TH DECEMBER 2020

SATURDAY

Red flag warnings causing huge delays on pension transactions

Pension providers have said that increased due diligence has given way to “over the top” scam screenings that are causing significant delays on certain pension transfers and switches. Both SIPP and small self-administered scheme providers have complained that scam red flags are being “over-used” and subsequent delays in legitimate transfers are causing consumer detriment. Richard Mattison, director at Whitehall Group, said delays in switches and transfers can cause a number of significant problems with losing deals, additional costs, bad will with vendors, among other things. Nathan Bridgeman, director of Westbridge Ssas, has also seen this as a growing issue. He said: “We have seen cases of third-party vendors pulling out of sales to Ssas as pension transfers have taken so long with unreasonable and unfair obstacles being put in place by the ceding schemes.”

FT Adviser

ECONOMY NEWS – WEEKEND TO 13TH DECEMBER 2020

SATURDAY

Bailey urges banks to keep lending

The Governor of the Bank of England, Andrew Bailey, has urged banks to keep lending and support the UK economy. Presenting the BoE’s latest Financial Stability Report, he said lenders had the “capacity to continue to support households and businesses” even if the economic chaos from coronavirus and Brexit was much worse than expected. Addressing Brexit concerns or a spike in coronavirus cases, Mr Bailey added: “What’s the Bank of England got in its armoury? The answer is a lot. We will use our tools as we did in March should we be in that situation.”

Reuters Daily Mail

Analysts expect stocks to fall as no-deal Brexit looms

Britain’s biggest banks saw their share price fall as much as 6% on Friday as analysts cut the odds of Brexit talks failing. Morgan Stanley warned they could fall further, perhaps by a fifth, in the event of no deal. The US bank told clients there was a “rising risk” of a no-deal Brexit which would lead the FTSE 250 to drop between 6 and 10%. JP Morgan cut the odds of a deal from 66% to 60% and suggested it could fall to 50% if there was no progress by Sunday night.

The Times

SUNDAY

CBI chief expresses disbelief over Brexit

Adam Marshall, director general of the British Chambers of Commerce, writes in the Observer that businesses have still not been informed of the rules under which they will have to operate from January 1st. Marshall writes: “It is hard to believe that we still have to ask ministers for clarity on the nuts and bolts of trade – things like rules of origin, customs software, tariff codes, and much more besides – just a fortnight before the end of the transition period.” He added that the lack of clarity will mean that investment decisions will be delayed. “Without official guidance, many will pause long-term planning and hold back on investment,” he states.

The Observer

QE will soon lose its efficacy, economists warn

Economists are warning that further quantitative easing will struggle to further stimulate spending and investment with the Bank of England on track to own half of UK government debt by the end of 2021. Bank of America economist Robert Wood suggested that QE “at this stage is defensive”, a tool that can “prevent tightening but cannot add more stimulus”. The comments follow the assertion from BoE Governor Andrew Bailey that rate-setters have plenty of ammunition ahead of a possible no-deal Brexit. Overall, analysts expect further QE before the Bank resorts to negative interest rates.

The Sunday Telegraph

INTERNATIONAL NEWS – WEEKEND TO 13TH DECEMBER 2020

SATURDAY

German audit watchdog chief faces probe over Wirecard share trading

The head of Germany’s audit watchdog is under investigation after he admitted to buying and selling shares in Wirecard whilst his own organisation was investigating the fraudulent payments company’s auditor.

Financial Times, Page: 8

OTHER NEWS – WEEKEND TO 13TH DECEMBER 2020

SATURDAY

Obituary: Paul Sarbanes

Paul Sarbanes, the force behind the Sarbanes-Oxley Act that transformed the regulation of auditors and financial reporting, has died aged 87.

Financial Times

Contact Paul Southward

Paul Southward


NEWS – WEEKEND TO 6TH SEPTEMBER 2020


NEWS – WEEKEND TO 6TH SEPTEMBER 2020

NEWS ROUNDUP

TAX NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SATURDAY

Economist: Pandemic can drive revamp of taxation

With Rishi Sunak believed to be considering tax increases as he looks to boost public finances that have taken a hit from the coronavirus crisis, Mark Littlewood, director general of the Institute of Economic Affairs (IEA), has suggested that the Chancellor could use the pandemic to revamp the tax system. Mr Littlewood, musing on whether taxes should be cut or increased to support the economy, said: “My own view is to increase tax in order to deal with the immediate deficit this year might actually be cutting off your nose to spite your face.” Suggesting that “we don’t need to solve the mess in the public finances overnight,” Mr Littlewood argues that the economic hit from COVID-19 could be treated like a war debt, saying that if ministers believe the crisis has delivered a once in a generation shock, “we could realistically pay that off over a generation.” He also says the pandemic could serve as a starting po int to revamp and simplify a system of taxation that is “very complicated” and probably unbalanced. Mr Littlewood goes on to say a reworked system that sees “those with the broadest shoulders … carry the heaviest burden” may hurt growth, warning against a system centred on “drawing all of the enhanced tax revenue from a relatively small albeit affluent part of the population”.

Daily Express

Taxing times for the Chancellor

Philip Aldrick in the Times considers the Chancellor’s options as he looks to fix the nation’s finance in the wake of the coronavirus crisis, arguing that tax will need to rise at some point but debate remains on when. He points to analysis from economists who suggest Rishi Sunak may “wait until the recovery is entrenched before unveiling new fiscal rules”. A Guardian editorial says reports that Mr Sunak is contemplating a radical and redistributive budget that includes steeper taxes for the wealthy “have to be taken with a pound of salt”. Lauren Davidson in the Telegraph says the dent to public finances stemming from the COVID-19 crisis clearly has to be paid for, but raising taxes to the extent some reports claim “is not the way to do it” and is not guaranteed to boost revenues. Juliet Samuel in the Telegraph also muses on mooted tax increases, saying it will be hard as the Tory manifesto ruled out any big increases and Boris Johnson “doesn’t believe in raising taxes”. Merryn Somerset Webb in the FT warns that the taxes discussed as targets for increases “won’t raise enough to touch the sides of the problem.”

The Times, Page: 50 The Guardian, Page: 49 The Daily Telegraph, Money, Page: 2 The Daily Telegraph, Money, Page: 19 Financial Times, Page; 16

MP in Budget rebellion threat

Amid ongoing speculation over an increase in taxes being considered by the Chancellor, Conservative MP David Davis has warned that he would be willing to rebel over the content of the Budget. He told BBC Radio 4’s The Week in Westminster: “I’m not exactly the most virtuous person in terms of not voting against my party. But I’ve never voted against a Budget in my life. If it’s a tax-raising Budget I will.”

The Daily Telegraph, Page: 8 The Sun, Page: 2

Investors act on tax shift fears

Harry Brennan in the Telegraph says wealthy individuals are selling off investment portfolios and second homes in fear of tax increases the Chancellor is said to be lining up for his autumn Budget, while others are pumping cash into pensions to take advantage of tax breaks and low rates before changes come into force.

The Daily Telegraph, Money, Page: 1

Can I avoid tax on gifts of over £3,000 to my children?

An FT reader’s request for advice sees Richard Jameson of Saffery Champness offering guidance on a matter related to inheritance tax.

Financial Times, Money, Page: 10

SUNDAY

PM and Chancellor forge pact on tax

Boris Johnson and the Chancellor have come to an agreement on taxation that will likely mean a hike in taxes in November’s budget, with tax cuts to follow in 2023 or 2024, ahead of the next election. The Sunday Times reports that Mr Johnson is not prepared to sanction rises in income tax, national insurance or VAT, but Rishi Sunak could equalise rates of capital gains tax with income tax and is said to be determined to suspend the “triple lock” on state pensions. Removing higher-rate tax relief on pension contributions is also likely to go ahead in November, the paper says. The Mail on Sunday describes the “fury” of Tory party donors who warn they will “turn off the funding taps” if Sunak hikes taxes on the wealthy to pay for the pandemic while Daniel Hannan in the Sunday Telegraph likens raising taxes to a second trauma for an economy already in a coma. Finally, the Observer&rs quo;s business leader says the time for “a big tax-raising budget has not yet arrived” and that, if anything, “the reverse is needed – an expansive budget with an increase in funding to protect the jobs of millions of workers. Concerns over the national debt should be sidelined.”

The Sunday Times, Page: 2 The Mail on Sunday, Page: 42 The Sunday Telegraph, Page: 18 The Observer, Page: 57

Reform property tax to level up the UK

A letter published in the Sunday Times calls for reform of Britain’s property taxes. Signatories including Matthew Lesh of the Adam Smith Institute; Carys Roberts, executive director at the Institute for Public Policy Research, MPs and others assert that: “Replacing council tax and stamp duty with one simple property tax, based on actual property value and people’s ability to pay, will result in a fairer system of taxation for most of us.” They continue: “The government is promising to “level up” Britain. It should make a start by conducting a thorough review of our residential property taxes.”

The Sunday Times, Page: 22

Paolo Gentiloni: Tech giants should pay more tax

Paolo Gentiloni, European Commissioner for economics and taxation, told CNBC on Saturday that Big Tech have been the winners from the coronavirus pandemic and that it is time they started paying a fair amount of tax in Europe. “The giants of the digital platforms are the real winners of this crisis, from the economical point of view,” Gentiloni stated. “We all experience this in our own lives.” If negotiations on a proposed new digital tax collapse at the OECD-level collapse by the year-end, the European Commission “will come out next year with our own a proposal,” Gentiloni said.

CNBC

Tax hikes would damage City of London, warns private equity veteran

City veteran Jon Moulton has warned that tax rises proposed by the Treasury would only benefit rival financial centres such as New York or Singapore, as London-based entrepreneurs with in-demand skills would be lured abroad.

The Sunday Telegraph, Business, Page: 3

CORPORATE NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SATURDAY

Chancellor unlikely to create toxic loan vehicle

The Telegraph reports that Chancellor Rishi Sunak is set to ignore calls to create a state-backed organisation that would refinance toxic business loans handed out as part of coronavirus support initiatives. Proposals put together by a taskforce led by trade body TheCityUK and EY would see the Government take responsibility for debts, easing the burden on banks. Lloyds chairman Norman Blackwell has warned that bankers will be expected to do “everything they can” to recover toxic coronavirus loans, with firms possibly put into administration or assets being sold off. Lord Blackwell suggested that “the best thing” for firms that remained viable would be to “take the loans off the banks, pay out their guarantee and put them in a vehicle which will over time try and recoup money from the companies.”

The Daily Telegraph, Page; 35 Financial Times, Page: 3

LCF directors sued over alleged fraud

Thirteen people are being sued in connection with an alleged fraud at London Capital & Finance, where administrator Smith & Williamson claims almost 60% of investors’ cash was channelled to executives. The investment firm collapsed last year when the Financial Conduct Authority said it was misleadingly promoting high-risk bonds. The scandal is the subject of an investigation by the Serious Fraud Office, while a separate regulatory probe is looking at EY, PwC and Oliver Clive & Co, LCF’s accounting firms.

The Times, Page: 52 Financial Times, Page: 16

Frasers in Debenhams gag claim

Mike Ashley’s Frasers Group says Debenhams’ advisers are blocking it from rescuing the retail chain due to a gagging order preventing it from talking to landlords. CFO Chris Wootton said Frasers is not formally involved in the sale because it refused to sign a nondisclosure agreement that would prevent it from talking to Debenhams’ landlords for 18 months. The Times cites a source close to Debenhams who points to concern that Frasers could use confidential data to strike separate deals for Debenhams’ best stores with landlords – with Debenhams’ administrators at FRP saying this would reduce the value of the business for creditors.

The Times, Page: 55

Redde Northgate snaps up repair business

Nationwide Accident Repairs group has been partially rescued by Redde Northgate in a pre-pack administration led by PwC. Under the terms of the deal, Redde Northgate will buy 77 of the company’s 102 bodyshops and a fleet of mobile repair vans for up to £16m. The deal saves around 2,300 jobs.

The Times, Page: 55

Fraud hit THG float

The Hut Group, an e-commerce company that this week announced plans for a £4.5bn float, cancelled a stock exchange listing planned for 2011 when auditor PwC discovered a multimillion-pound fraud.

The Guardian, Page: 37

SUNDAY

The City is prone to group-think, too

Oliver Shah considers how Japan’s corporate culture helped to enable the Olympus scandal and the reaction of the German establishment to the Wirecard fraud, asserting that both countries appear better able to reflect on their failures than the UK, where the prevailing attitude in the City to those burnt by fraud is simply: “Caveat emptor, mate — hard luck.”

The Sunday Times, Business, Page: 9

Busaba set for restructuring pain

Duff & Phelps has been hired by Thai restaurant chain Busaba to handle its CVA as the business looks to restructure. Busaba has 13 restaurants and 350 staff and plans to close one restaurant permanently. Five others will stay closed until it is viable for them to reopen, and seven will keep trading.

The Sunday Times, Business, Page: 2

PENSIONS NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SATURDAY

Savers at risk of double tax on pensions

Jessica Beard in the Telegraph expresses concern that a mooted cull of higher-rate pensions tax relief could leave more than half a million workers at risk of being charged “double tax” on retirement savings. Noting that Chancellor Rishi Sunak is considering cutting relief from 40% for higher-rate taxpayers to a flat rate of 20%, she argues that reform would see higher rate taxpayers who remain in the upper bracket after they retire receive 20% tax relief on pension contributions during their working years but charged a 40% tax rate in retirement.

The Daily Telegraph, Money, Page: 3

Case for pensions tax rise to aid Covid recovery

Paul Johnson, head of the Institute for Fiscal Studies, has told the Treasury Select Committee there is a case for “at least a modest increase” in tax on pensions in payment.

Financial Times, Money, Page: 2

SUNDAY

Advisers set to exit pension transfer market

The Sunday Telegraph reports that savers who want to transfer out of their final salary pensions will struggle to do so in future, with nearly half of all advisers unsure if they will still be in the market in a year’s time. A report by Royal London and Lane Clark & Peacock reveals advisers are concerned they will no longer be able to afford the costs and risks of transfer advice. It comes after the Financial Conduct Authority stepped up its efforts to stamp out poor advice and raise awareness of the risks of switching to more flexible pension schemes. From October 1, firms will no longer be able to offer “contingent” charging models and this ban will prompt a fresh wave of advisers to flee the market, the report warned. The Personal Finance Society has urged the Government to consider a temporary, state-backed alternative to indemnity insurance to ensure advisers are not squeezed on costs.

The Sunday Telegraph The Mail on Sunday, Page: 104

TECHNOLOGY NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SUNDAY

Tech has potential to be the engine of our economy for years to come

Tony Spillett, tax partner and UK head of technology and media at BDO, writes in the Sunday Times on how the UK’s technology sector has emerged faster and stronger from lockdown than most other areas of the economy and calls for a boost to the UK’s innovative reputation, “which must be enabled rather than impeded by Brexit.”

The Sunday Times, Tech Track 100, Page: 6

INSOLVENCY NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SATURDAY

Fall in insolvent business debt

A report from Red Flag Alert shows that the coronavirus crisis led to a drop of £189m in insolvent business debt during the last quarter, with total insolvent business debt at £1.577bn at the end of June, down 10.7% from £1.766bn at the end of March.

Yorkshire Post, Page: 24

EMPLOYMENT NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SUNDAY

CBI boss urges UK Government to adopt new jobs support scheme

CBI boss Carolyn Fairbairn has said the Government needs a successor to its furlough scheme as she warned against a rise in corporate taxes, calling instead for an extension of business support schemes. Ms Fairbairn’s comments come as MPs from across the political spectrum call for the Chancellor to introduce a more targeted support scheme to help the areas hardest hit by COVID-19 – particularly, hospitality and the media and creative industries.

Financial Times . The Sunday Telegraph, Business, Page: 1

Rise in minimum wage ‘unaffordable’ after pandemic

The Sunday Telegraph reports that certain members of the Low Pay Commission are warning that Britain will not be able to afford a planned increase in the minimum wage due to the coronavirus pandemic. The rate was expected to rise from £8.72 to £9.21 per hour in April but experts now believe the pay hike could now be unaffordable for many companies and result in increased unemployment.

The Sunday Telegraph, Business, Page: 1, 6

PROPERTY NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SATURDAY

Investors look to holiday lets

The Times’ Jessie Hewitson says that while the Treasury has “radically pruned” the tax breaks available on most mainstream investments, holiday homes are the one money-making venture that lets an investor potentially avoid the “accounting holy trinity” of income tax, capital gains tax and inheritance tax. Heather Powell from Blick Rothenberg says some investors are opting to convert their buy-to-let properties to holiday lets.

The Times, Page: 60

SMEs NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SATURDAY

 

Investors urge start-ups to return to offices

Prominent technology investors have urged start-ups to return to offices, voicing concerns that continued working from home could harm their productivity. Brent Hoberman, co-founder the firstminute Capital investment fund, said: “I think it’s going to be very detrimental if we keep people apart and we lose the team spirit and learning by osmosis that happens in offices”. Tim Levene, CEO of venture capital business Augmentum, has called on CEOs to “recognise that we cannot continue to operate as we have been these past few months,” warning of dangers to the mental health of start-up employees if they continue to work from home.

The Daily Telegraph

SUNDAY

Warning over stress of late payment

Small Business Commissioner Philip King has written to large businesses warning them that if they reduce the credit they make available to small suppliers many SMEs will go bust. Mr King urged small businesses to get in touch with his office if they are experiencing late payment problems and said that many of the companies he has written to promptly paid up.

Sunday Express, Page: 43

ECONOMY NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SATURDAY

BoE policymaker: Further QE may be needed to hit inflation target

Senior Bank of England (BoE) policymaker Michael Saunders has warned an economic recovery could stall, pushing the Bank to increase quantitative easing measures. Mr Saunders, who votes on interest rates as a member of the Bank’s Monetary Policy Committee, voiced concern that the end of the furlough scheme will drive an increase in unemployment, while the initial boost from lockdown measures being eased could subside. While the economic rebound has recently exceeded BoE expectations, Mr Saunders said: “I would be cautious about extrapolating much from this apparent outperformance.” He also said he suspects that government support measures – such as the job retention scheme, tax payment deferrals, and mortgage holidays – “turned out to be more powerful than expected in supporting household incomes and spending.” Mr Saunders thinks it is “quite likely” that additional monetary easing will be required for inflation to see a “sustained re turn” to the 2% target.

The Daily Telegraph Financial Times, Page: 3

Stress test reveals potential blow to borrowing cost

Stress tests by the Treasury show that if the interest rate were to increase from 0.2% to 1%, the Government’s borrowing costs would be driven up by between £30bn and £40bn a year. The Telegraph says the analysis is likely to prompt calls for the Bank of England to continue with quantitative easing, which is currently only guaranteed until the end of the year.

The Daily Telegraph, Page: 8

SUNDAY

Pubs and restaurants help economy to 6% growth in July

Figures due out on Friday are likely to show Britain’s economy grew by 6% in July compared with June with GDP bolstered by the re-opening of pubs, restaurants, hairdressers and other services from the beginning of the month. The EY Item Club expects economic growth to have continued in August thanks to the Eat Out to Help Out scheme, but Howard Archer, the group’s chief economist warns: “The big question mark is what happens in the fourth quarter. There is only so much pent-up demand and with the furlough scheme coming to an end we can expect job cuts, the scale of which is a big unknown.”

The Mail on Sunday, Page: 98

Remote working will cost Britain £15bn a year

A report by PwC warns that the economy could be dealt a £15.3bn blow every year due to impact of remote working on cleaners, coffee shops and security guards. Jonathan Gillham, PwC’s chief economist, said that while suburbs and smaller towns stood to benefit from home-working, the overall economy would suffer because of the impact on bigger cities such as London and Manchester.

The Sunday Times, Business, Page: 1

OTHER NEWS – WEEKEND TO 6TH SEPTEMBER 2020

SUNDAY

Monzo limits fee-free cash withdrawals

Monzo has capped the amount of cash that customers can withdraw without incurring a fee at £250 amid concern over the digital bank’s financial health. Customers will be charged a 3% fee for withdrawals over this amount. Auditors at EY warned of “significant doubt” over the bank’s ability to operate as a going concern because of the uncertainty caused by COVID-19.

The Sunday Times, Business, Page: 14

Contact Paul Southward

Paul Southward