Category Archives: News Roundup

News Roundup Wednesday 28th November 2018

News Roundup Wednesday 28th November 2018




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Advisory Fuel Rates

Accidentally rich’ face ‘unfair’ IHT

Experts have said that IHT should be cut for “accidental millionaires” as they are being forced to pay a bigger chunk of their inheritance than the ultra-rich. The Office for Tax Simplification found that in 2015-16, bequeathed estates worth between £2m and £8m paid a rate double that paid on estates greater than £10m. Someone who inherited a sum of £2m – now the value of many houses in the South East – would pay an average of 20% of the total in IHT, compared to just 10% of a £10m estate. Despite a new “family home allowance” introduced in April 2017, providing added protection for those passing on their home to direct descendants, experts described the effect of the reliefs as unfair. Andy Butcher, a tax expert at Raymond James, said: “In light of the figures that show wealthier estates are paying a lower effective rate of tax, I would be in favour of a tiered approach to inheritance tax re ducing the rate for estates that fall into the accidental-rich category. IHT is a tax on assets that have already been taxed so is already unfair”

The Daily Telegraph

OTS proposes raft of IHT changes

City AM’s Katherine Denham reports on the recommendations from the Office of Tax Simplification for reform of IHT. One key recommendation is to move to a fully integrated digital system similar to the self-assessment process. Clearer guidance is also suggested along with better communication from the tax office. Denham hopes that, although nothing is likely to be implemented any time soon, the hefty body of recommendations should eventually lead to an IHT shake-up.

City AM


Rush of probate applications expected ahead of fee hike

The ICAEW has warned that courts could be overwhelmed by a rush of probate applications as people hurry to arrange their affairs before the Government’s proposed new fee structure is introduced. The changes, expected to come into force in April 2019, will see estates worth £2m or more pay £6,000 in probate fees, up from £155 currently. Estates worth less than £50,000 will pay nothing. Jane Berney of the ICAEW said: “When the MoJ first consulted on these changes in 2016, 97% of respondents were against them, yet the department is still going ahead. Probate offices will need to gear themselves up for an influx of applications in advance of the planned increases as executors rush through the process to try and beat the price hike.”

The Daily Telegraph Daily Express Daily Mail, Page: 46

FRC stays formal complaint against Autonomy CFO

The Financial Reporting Council (FRC) has announced that the formal complaint against Sushovan Hussain, former CFO of Autonomy, has been stayed, pending the outcome of his intended appeal against his conviction on 16 counts of fraud in the US District Court for the Northern District of California. Mr Hussain has consented to an order suspending him from membership of the ICAEW until the formal complaint against him can be heard.

Financial Reporting Council The Times, Page: 41

Aim deals slowdown ahead of Brexit

Dealmaking on London’s AIM has dropped 28% in a year as investors adopt a wait-and-see approach ahead of Brexit. Research by UHY Hacker Young shows 21 M&A deals took place on Aim in 2017-18, down from 29 in 2016-17. The value of transactions also fell, dropping 65% to £1.32bn, down from £3.74bn in 2016-17.

City AM, Page: 7

Danske Bank scandal spurs UK crackdown on limited partnerships

The UK is to tighten rules on limited partnerships and Scottish limited partnerships requiring them to maintain a link to the UK and be registered via an official supervised agent.

Financial Times


Forensic audit hit Thomas Cook for £30m

The Standard‘s Jim Armitage reports on how a forensic examination of Thomas Cook’s accounts by EY after CEO Peter Fankhauser’s profit warning in September wiped an unexpected £30m off the travel company’s profits for the year. Separately Disclosed Items had been parked to one side without accounting for them in profits.

Evening Standard


UK Government in Funding Circle deal to boost SME lending

The British Business Bank has agreed to fund £150m worth of small business loans through Funding Circle in an attempt to encourage firms to continue investing in the face of economic uncertainty.

Financial Times

Small businesses overpaying for mobiles

A lack of competition in the mobile phone market means small businesses are paying £1bn too much for mobile services, according to a report from price comparison website Billmonitor. The firm estimates 49% of UK businesses pay more than twice what they should for mobile services from EE, Vodafone and O2.

City AM, Page: 17


Minimum wage rises have not led to job losses

Employment levels have been sustained despite increases in the minimum wage, according to the Low Pay Commission. Business had raised concerns over the costs of rising wages, but most have absorbed them and restructured workforces. The National Living Wage for those aged 25 and over stands at £7.83 an hour and is due to rise to £8.21 from next April. The Guardian reports that about 23% of all of those over the age of 25 who are covered by the national living wage were underpaid this year. Meanwhile, ONS data show one in three new jobs created in the UK over the past decade has been in London. The north-east of England saw the lowest percentage increase in new jobs of any UK region or nation.

BBC News BBC News The Guardian


Brexit GDP claim disputed

A pro-Brexit economist has criticised research that claims the Prime Minister’s Brexit deal could reduce the UK’s GDP by up to 5.5% over the next 10 years. Researchers at the London School of Economics, King’s College London and the Institute for Fiscal Studies said the withdrawal agreement could shrink UK GDP per person by between 1.9% and 5.5%. According to the think tank The UK in a Changing Europe’s report, the cost to public finances would be between 0.4% and 1.8% of GDP over the same timeframe. It comes the day after a separate report said the economy would be £100bn worse off under Theresa May’s deal. However, Arbuthnot Banking Group economic advisor Ruth Lea said that both studies were flawed, leaving many questions unanswered. “These ‘studies’ are barely worth the paper they are printed on, it is difficult to forecast 12 months ahead never mind 12 years,” she said. “So many assumptions have to be made. Will we have Thatcherite or Corbynite policies? How successful will our trade deals be? Will there be radical tax and regulatory reforms or not? How is the world economy going to grow?”

City AM

Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Friday 26th October 2018

News Roundup Friday 26th October 2018



Hammond urged to simplify taxes and increase investment

Philip Hammond has been urged to simplify Britain’s taxation system in response to Britain leaving the EU. TheCityUK says it is “critical” that taxes on banks are “normalised” to lower levels during the Brexit process. The lobby group also says the chancellor should use next week’s Budget to rebalance the economy by prioritising spending on infrastructure outside London and the southeast. Meanwhile, a report to be published later this week by the Fabian society and the ICAEW says public spending needs to rise by at least four percentage points over the coming years to halt austerity. The Fabian report says there is no clear case for the chancellor to stick to his plan of running a surplus. Elsewhere, the FT claims Mr Hammond may be able to avoid increasing taxes to pay for NHS spending, after the OBR underestimated the recent strength of tax receipts by £13bn.

The Times, Page: 40 The Guardian, Page: 29 Financial Times, Page: 1

HMRC’s digital push must consider vulnerable users

Lauren Davidson, the Telegraph’s personal finance editor, reveals that even she has struggled to access her online HMRC account. HMRC’s roll-out of online self-assessments, part of its Making Tax Digital campaign, has been plagued with hiccups and delays, she says, and if it is to be successful the Revenue must ensure that the system works not just for the “tech-savvy”, but also for pensioners and other less technically-minded, more vulnerable members of society, who might not only struggle to complete assessment forms online – but may also be exposed to scams and bogus websites.

The Daily Telegraph

Online sales tax would be a ‘luddite levy’

Economic policy adviser Max von Thun says that introducing a special sales tax on online companies would be a “huge mistake.” He claims that what is ultimately needed is not for individual countries to act unilaterally, but to work together towards a new international system for taxing profits that reflects the complex nature of value creation in a digital economy.

City AM, Page: 25

Germany proposes global minimum tax for tech giants

Germany’s finance minister Olaf Scholz has suggested a global minimum corporate tax for multinationals such as Amazon, Apple and Facebook. Mr Scholz said the internet economy “was exacerbating” the problem of companies piling their profits into tax havens, and that coordinated mechanisms were needed to force companies to pay domestic taxes in proportion to their profits.

The Daily Telegraph

HMRC ‘fishing’ for footballers avoiding tax

UHY Hacker Young has suggested HMRC is increasingly “fishing” to catch footballers out over image rights payments, after it emerged that tax investigators are looking into the accounts of 44 football clubs and 171 players.

The Sun, Page: 48 Daily Mail, Page: 28 The Guardian, Page: 41

Hammond ‘needs to find £31bn’ to end austerity

The Resolution Foundation says Philip Hammond will need to find £31bn in next week’s Budget if he is to deliver the prime minister’s promise to end austerity. The OBR has forecast a windfall of £13bn for the Treasury thanks to better than predicted tax receipts, and Conservative MPs have urged Mr Hammond to use this to ease the tax burden on households. However, the Resolution Foundation believes £31bn would still be required by 2022-23 to prevent planned cuts to public services, end the benefits freeze and restore the value of work allowances in universal credit. Meanwhile, the Telegraph’s Jeremy Warner suggests Mr Hammond should use the Budget to set out plans for a programme of bold tax cuts, as Brexit is set to “drive Britain naturally towards a low tax future.” Elsewhere, PwC’s Stella Amiss writes in City AM that the Budget is a chance for an long-overdue ov erhaul of the tax system.

The Times, Page: 6 Financial Times, Page: 2 Daily Express, Page: 1,4-5 The Daily Telegraph, Business, Page: 2 The Daily Telegraph, Business, Page: 4 City AM, Page: 23

Tech giants threaten to cut investment

Technology companies have threatened to pull post-Brexit investment from the UK if Philip Hammond goes ahead with a tax on digital sales in the Budget. Multinationals including Facebook, Amazon and Uber have written to the chancellor warning that they will reduce spending if he makes a “smash and grab raid” on their earnings. They have also warned that any attempt to impose a specific tax on mainly American digital multinationals would result in retaliation from President Trump. The CIOT has also urged caution from the chancellor on his suggestion to go it alone with a temporary new sales tax on digital multinational companies. Separately, economist Dr Jeffrey Sachs has told the Guardian that a “tech tax” is necessary if the world is to avoid a dystopian future in which AI leads. He also backed calls for taxation aimed at the largest tech companies, arguing that new technologies were dramatically shifting the income d istribution worldwide “from labour to intellectual property (IP) and other capital income.”

The Times, Page: 6 The Guardian, Page: 29 Politics

London tops IHT league

Families in west London pay an average of £390,000 inheritance tax per estate – more than people anywhere else in Britain. A freedom of information request by Direct Line shows that 118 estates in the area paid £46m of inheritance in total tax between 2015 and 2016. Estates in northwest London postcodes were liable for the second-highest bills at an average of £381,546. This was followed by southwest London at an average of £346,565. HMRC said that rising house prices contributed to a £17bn increase in the value of estates between 2009-10 and 2015-16.

The Times, Page: 12

HMRC victorious in £79m tax avoidance case

HMRC has won a £79m tax avoidance case against Goldman Sachs and Cargill. The case, one of the biggest corporate tax wins for HMRC in recent years, relates to a tax avoidance scheme set up in 2006-07 when the US giants owned the now-defunct Teesside power station. Teesside Power successfully claimed through US bankruptcy proceedings for hundreds of millions of pounds that were owed to the plant. Teesside Power then set up a Jersey-based company to try to avoid paying corporation tax on about £200m of the money it claimed by converting it into shares.

The Times, Page: 38

Banks looking for Budget boost

UK Finance has, in a detailed submission to the Chancellor, suggested that “the time may be due for a strategic review of government policy toward bank-specific taxes”. It has commissioned two reports on the matter, with one looking at UK banks’ total ta x contribution and another at how the UK compares with other countries. UK Finance’s focus is said to be on the bank levy introduced in the aftermath of the financial crisis and the corporation surcharge tax on banks.

The Times, Page: 39

ACCA’s Roy-Chowdhury previews Budget possibilities

Chas Roy-Chowdhury, head of taxation at ACCA, previews the forthcoming Budget. It is likely that the Chancellor will cut the £40,000 annual allowance for pension savers to about £35,000, he begins, and may also target those taking on work through private firms when they should be treated as employees. Corporation tax could be lowered further, from the 17% already anticipated by 2020, he suggests, adding that income tax personal allowance will likely rise to £12,500 within the next two years. It’s unlikely that the Chancellor will touch IHT, he adds, though some form of Digital Sales Tax could appear.

City AM

BBC should pay presenters’ tax bills, say MPs

A report by the Commons culture committee has labelled the BBC’s pay policies as disgraceful and recommended that it pay tens of millions of pounds to presenters it forced off staff contracts. MPs said it was deplorable that the corporation had forced employees to set up personal service companies, which has left many with hundreds of thousands of pounds of debt following tax changes.

The Times, Page: 7 Daily Mail, Page: 12

IHT cuts ‘could pay for themselves’

The Times’ Ian King argues that Philip Hammond should radically reform IHT by sweeping away all reliefs and exemptions while at the same time cutting the rate from the present 40% to a flat rate of 5%, on all estates worth more than £50,000. He says cutting to such a low rate would raise yields because there would be little point in going to the trouble of avoiding the tax.

The Times, Page: 41

Budget blueprint

The Times’ Ed Conway offers some suggestions to Philip Hammond ahead of the Budget. He says the chancellor should introduce more wealth taxes, abolish stamp duty and council tax and replace them with a property tax based on actual house prices. In an ideal world, he says Mr Hammond would also merge income tax with national insurance. He might also consider abolishing inheritance tax and replacing it with a lifetime gift allowance. Finally, says Mr Conway, the chancellor should scrap corporation tax and replace it with a local business levy.

The Times, Page: 31

Labour to tax and spend to end austerity

Shadow chancellor John McDonnell has told the BBC that a Labour government will end austerity, partly by raising income tax on the top 5% of earners, increasing enforcement of tax avoidance and evasion, and raising corporation tax.

The Guardian, Page: 35


Hammond may raise rates relief

Philip Hammond is said to be considering raising the threshold at which firms start paying business rates in next week’s Budget. The Treasury is reportedly looking at raising the small business rate relief (SBRR) threshold to £20,000. The move would cost £1.4bn in lost revenue but experts say it is vital as business rates are forecast to rise by £730m in April. The chancellor is also considering changing the planning system to accelerate the conversion of empty shops into homes, as part of efforts to boost high streets and tackle the housing crisis.

Daily Mirror, Page: 5 The Sun, Page: 6 Financial Times, Page: 3 Daily Mail, Page: 2

Tribunals not the answer to bank disputes

An independent review has concluded that the Financial Ombudsman Service should be overhauled to give it stronger powers to help SMEs that are wronged by their banks. However, the report by Simon Walker, former head of the Institute of Directors, also warned the government against adopting proposals for a new tribunal system to help small companies resolve disputes with lenders. Mr Walker said a tribunal system would be “expensive for government and for participants” and might do little to address an inherent imbalance in power between small businesses and banks.

The Times, Page; 40 Financial Times, Page: 3

More small firms in liquidation

The number of smaller firms going into liquidation has increased by 32% in 2018, according to KPMG. Some 679 companies were affected in the first nine months of the year, compared to 513 in the same period of 2017. KPMG’s Blair Nimmo said that “local challenges” had a “negative impact on smaller traders”. The rise in liquidations meant there was an increase in company insolvencies, which went from 581 in the first nine months of 2017 to 721 over January to September 2018.

The Scotsman, Page: 9 The Press and Journal, Page: 31

NatWest boosts funding for firms preparing for Brexit

NatWest is trebling its “growth fund” for small businesses to £3bn, up from an initial £1bn revealed in May this year. The bank has identified almost 2,000 business customers it believes may need extra cash to help weather Brexit and is already “proactively” contacting them.

The Daily Telegraph, Business, Page: 8 The Times, Page: 38

Hammond weighs lowering VAT threshold for small businesses

Philip Hammond is considering cutting the £85,000 turnover threshold for VAT after being advised that companies stop growing, or lie, to avoid crossing the line.

Financial Times, Page: 2

MPs call for urgent overhaul of small business lending

MPs have called for a drastic overhaul of Britain’s approach to small business lending, citing the “scandalous” treatment of companies at the hands of big banks. A report by the Treasury select committee said commercial loans must be urgently regulated to prevent a repeat of the abuse of thousands of SMEs after the financial crisis. MPs concluded that the Financial Conduct Authority’s decision not to punish RBS for the actions of its Global Restructuring Group (GRG), which the regulator had found to have systematically mistreated small businesses, was a “damning indictment of the regulatory regime and a sad reflection of its inadequacies”.

The Times, Page: 41

Pension billions will back drive in start-ups

Philip Hammond is expected to use the Budget to unleash billions of pounds worth of cash to back promising businesses. The chancellor will announce measures to make it easier for pension savings to power up new industries and generate extra returns for savers. Mr Hammond indicated a review is on the way earlier this month, promising to “ensure defined contribution pension funds are able to make long-term investment decisions, for the benefit of both their members, and the wider economy.”

The Daily Telegraph, Business, Page: 1


Pressure on Patisserie over fraud inquiry

Leading investors in Patisserie Valerie have called on chairman Luke Johnson to give up control of an internal investigation into the £40m hole in its accounts. Invesco, a top ten shareholder in the company, has told Mr Johnson and the board of Patisserie Holdings to hand over the investigation to a law firm or an independent investigation firm during talks last week. Meanwhile, the FT’s Matthew Vincent says questions have been raised over the sale of shares by Patisserie’s chief executive and finance director in recent months.

The Times, Page: 37 Financial Times, Page: 18

Patisserie silent over share option discrepancy

Investors have expressed yet more concerns about the governance of Patisserie Valerie, after it emerged the café chain’s parent company may have issued twice as many share options to two of its directors as it disclosed to investors in its most recent annual accounts. Tim Bush, head of governance at Pirc, said: “It’s difficult to reconcile the number of shares issued under option with what was disclosed as share options in the last annual report.”

The Times, Page: 35-36

FTSE sees exodus of executives

Nearly a fifth of chief executives from the FTSE 100 have stepped down from their positions this year, with 18 top bosses departing. Only in 2007 amid the impending crash and in 2013 were there a similar number of chief executives exiting large-cap companies, at 17. The Telegraph suggests that rising anger over executive pay means some CEOs are being compensated for the fact that churn among top-flight bosses is increasing. Tom Gosling, a partner at PwC, said the risk of the CEO position had “undoubtedly changed” over the past couple of decades. Far more pay is now in the form of bonuses and long-term incentives and much less in the form of generous pensions, he added.

The Daily Telegraph, Business, Page: 8

Energy group takes accounting hit

Yu Group has warned it will take a £10m hit after uncovering accounting irregularities. The energy supplier said that problems with the way historic accrued income is recognised, as well as higher-than-expected non-payments from trade debtors, will push it to an annual loss.

The I, Page: 41

Air Partner lifts dividend despite auditor warning

Private jet operator Air Partner has raised its dividend despite its auditor Deloitte repeating a warning over the historical “concealment” of a multimillion-pound accounting black hole. Air Partner suspended its shares in April after it unearthed a £4m hole in its books. The carrier’s profit before tax fell almost a third to £2.6m, but it lifted its interim dividend per share 2.9% to 1.75p. Deloitte said there were “limitations in the company’s ability to recreate historical accounting records in respect of £3.4m of the accumulated £4.4m overstatement of net assets”. Deloitte has also handed in its resignation and Air Partner is understood to be in the process of re-tendering its audit.

The Daily Telegraph, Business, Page: 3

Lloyds FD to retire

Lloyds Banking Group has announced that its finance boss George Culmer, who helped steer the ship back from the brink following the 2008 financial crisis, is to retire next summer.

The Daily Telegraph Financial Times, Page: 19

Drax appoints Andy Skelton as CFO

Power firm Drax, which owns the UK’s largest plant in North Yorkshire, has appointed Andy Skelton as CFO.

Financial Times


HMRC changes to hit pensioners

Hundreds of thousands of pensioners could get less than they are due from the end of this month, according to financial consultancy Willis Towers Watson. The firm warned that after October 31 company pension schemes will not be able to easily check with HMRC that they have the correct information to pay pensioners the right income – affecting both state and final salary employer pensions.

The Daily Telegraph

Budget pensions move could deepen doctor hiring crisis, says BMA

The British Medical Association has warned that cuts to pensions tax relief could lead to some senior doctors facing tax charges of tens of thousands of pounds.

Financial Times, Page: 2


High stamp duty sees London house sales at record low

House sales in central London have dropped to a record low as buyers are deterred by high stamp duty, according to an analysis by London Central Portfolio. Just 70 properties are being sold each week – down 16.8% on last year.

Daily Mail, Page: 71

Landlords ‘navigating around’ buy-to-let tax rules

According to data from Mortgages for Business, landlords are increasingly choosing to own properties through companies to get around new tax rules. Research shows that 44% of completed buy-to-let mortgages are now done through limited companies, up 42% from the previous quarter, while the amount of limited company buy-to-let deals rose from 263 in the third quarter of 2017 to 628 in the same quarter this year.

The Daily Telegraph

Debenhams’ rates bill through the roof

Philip Hammond is facing more pressure to act on business rates after Debenhams announced plans to close 50 stores following the worst loss in its 240-year history. The retailer’s chief executive Sergio Bucher highlighted that Debenhams now pays £80m a year in business rates and called on the government to end the “preferential” tax regime for online retailers. The Telegraph’s Jeremy Warner says there is now an urgent need to shift from a tax based on property to one levied on sales in the retail sector. He adds that increasingly, business rates are treated not as a conventional tax but as a money machine for the Treasury.

The Guardian, Page: 20-21 The Sun, Page: 8, 49 The Daily Telegraph, Business, Page: 3 The Daily Telegraph, Page: 21 Daily Mail, Page: 12

Cut property taxes to solve housing crisis, RLA boss urges

David Smith, policy director for the Residential Landlords Association (RLA), argues that the Government’s approach to the way the sector is taxed is hurting those most reliant on the rental market for a place to live. He warns that another 130,000 private rented homes could be lost in the year ahead as a result of the Government’s tax hikes on the sector, which include restricting mortgage interest relief to the basic rate of income tax and imposing a stamp duty levy on the purchase of new homes to rent out, while the demand for private rented homes continues to increase.

The Daily Telegraph


Sluggish wage growth hits household confidence

Confidence among British households over their finances hit a three-month low as wages rose at their most sluggish rate since February. IHS Markit found that a “pessimistic tilt” helped to suppress confidence from 45.7 in September to 45.1 in October.

The Times

Young workers enjoy biggest pay rises

Analysis by the ONS suggests that while young Britons have been worst-hit by the squeeze on living standards, when it comes to pay rises they are ahead of the rest. The typical worker aged 16 to 24 is getting an annual pay rise of almost 30%, whereas the typical 56 to 64-year-old is getting only 1.6%.

The Times The Daily Telegraph, Business, Page: 8

Brexit bites into manufacturing orders

British manufacturing orders fell at their fastest pa ce since October 2015 in the third quarter, according to the latest statistics from the CBI, amid continuing uncertainty over a Brexit deal.

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

Service exports surge

Service exports increased to £72.3bn in the second quarter of 2018, up from £66.9bn in the first quarter, and up from £68.6bn during the same period in 2017, according to the ONS. Exports to the EU increased by more than any other region between the first and second quarter. However, the US remained the UK’s largest single country trade partner, buying £15.2bn of British services in the second quarter. ‘Other business services’ – including legal, accounting and advertising – was the biggest type of exported services, followed by financial services.

The Daily Telegraph The Times, Page: 38-39

Scottish corporate failures fall over Q3

Latest data from the Accountant in Bankruptcy (AiB) shows the number of Scottish companies failing dropped during the third quarter. However, the data continues to indicate “a trend of rising insolvencies” according to analysis of the latest figures by French Duncan. There were 232 corporate insolvencies in Scotland between July and September, a 5.3% drop compared with the previous quarter but 3.6% higher than the same quarter in 2017.

The Scotsman, Page: 37
No-deal predicted to drag down growth

The National Institute of Economic and Social Research has warned that Britain’s economic growth will slow to its lowest rate in a decade in the event of a no-deal Brexit. The institute said such an outcome meant economic growth would only be 0.3% in both 2019 and 2020, compared with 1.9% and 1.6% in a soft-Brexit scenario. Meanwhile, the Bank of England has warned UK banks to ensure they hold enough cash to withstand any disorderly Brexit hitting financial markets next March. Deputy Governor Sam Woods said he was making sure that Britain’s departure from the EU is as smooth as possible for markets, even if there is no agreement in place between the UK and Brussels.

The Times The Times Financial Times Daily Mail The Guardian, Page: 35

British shoppers showing signs of optimism

PwC ’s latest retail consumer survey reveals just over a quarter of UK retail consumers think they will be better off in the next 12 months.

City AM


Retailers urge chancellor to scrap tax-free shopping reforms

Some 600 retailers – including Harrods and Fortnum & Mason – have written to Philip Hammond asking him to scrap the government’s proposal to digitise tax-free shopping. The letter states that the industry has “lost confidence” in the Treasury’s reform of tax-free shopping, which “risks a further loss of international competitiveness post-Brexit”.

The Times, Page: 38-39

Stephen Hawking’s archive donated to the nation to settle IHT bill

A large part of the archive of Stephen Hawking is to be donated to the nation to help his family pay millions in IHT. Professor Hawking’s estate was valued at around £15m after his death in March. His family have now asked Christie’s to value his archive so that a large proportion can be donated to the nation through the Acceptance in Lieu process.

The Daily Telegraph, Page: 3
Rehash drug policy to boost tax coffers, says thinktank

A report by the TaxPayers’ Alliance (TPA) argues that legalising cannabis would reduce spending by police, prisons, courts and the NHS and provide the Treasury with a tax boost of around £900m a year.

City AM
Billionaires getting richer

A report by UBS and PwC shows billionaires made more money in 2017 than in any year in recorded history. The richest people on earth increased their wealth by a fifth last year to a record $8.9tn (£6.9tn).

The Guardian

Sheeran stumps up…

Ed Sheeran paid £5.3m in tax last year – or £14,560 every day. An accountancy source said: “He deserves maximum credit for paying every last penny.”

Daily Star, Page: 16

…while Bale battles bill

Gareth Bale is appealing a fine of nearly £300,000 from the Spanish authorities for avoiding paying tax on his image rights.

Daily Mail Daily Star, Page: 16 The Sun, Page: 62

Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Tuesday 23rd October 2018

News Roundup Tuesday 23rd October 2018



Chancellor looking to budget for extra spending

With the Budget fast approaching and Theresa May signalling an end to austerity, speculation is mounting as to how Philip Hammond could raise revenues to pay for increased NHS spending and reverse planned cuts to services. The Resolution Foundation has said a freeze on income tax and IHT thresholds could raise billions of pounds for public services. The thinktank also said cutting a string of tax reliefs for employers would improve the chancellor’s warchest. Meanwhile, the IFS has said the “minimal definition” of ending austerity would require 1% to be added to VAT, income tax rates and NICs, although Anna Isaac in the Telegraph says such a move would be “politically explosive.” Ms Isaac compares Mr Hammond’s situation to Kenneth Clarke’s first Budget as chancellor in November 1993, which delivered some of the largest tax hikes since the aftermath of the Second World War, as well as the “surreptitious tax take”, of freezing the personal allowance for income tax. Els ewhere, the FT’s leader says Mr Hammond must be upfront about the fact that higher taxes will be needed to pay for increased spending. Lastly, the Telegraph’s editorial warns the chancellor against scrapping tax breaks for pensions, suggesting he would be “storing up trouble for decades to come.”

The Daily Telegraph The Daily Telegraph, Page: 17 Financial Times The Times, Page: 2 The Guardian, Page: 9

Corporate tax dodging costs £25m

A report by the Tax Justice Network (TJN) says the government is missing out on £25bn a year through corporate tax dodging. The black hole comes from multinational companies switching cash between countries to deprive public coffers and maximise profits, according to the report. The TJN also claims the Government could easily haul back a 10th of the total simply by demanding firms publish country-by-country financial data.

Daily Mirror, Page: 12

Patisserie Valerie’s problems put spotlight on Aim tax breaks

In light of the accounting problems at Patisserie Valerie, the FT’s Kate Burgess says the Government should examine whether Aim tax breaks draw the wrong type of investors.

Financial Times, Page: 19


Town centres face crippling rates blow

An investigation by the Mirror has found that town centres will be among the worst hit by a new wave of business rate rises planned from next April. Libraries, pubs, post offices, banks and restaurants will all face another rise in their rates. The Mirror has called for the reform of rates in a campaign, while it also carries an editorial from Tesco CEO Dave Lewis who backs the crusade and recommends a 2% levy on goods sold online. He says this would raise £1.25bn – enough to pay for a 20% cut to business rates for shops all over the country.

Daily Mirror, Page: 12

More millennials in director roles

The number of millennials holding director roles at SMEs increased by 37% to 56,000 in the past year, according to research by Moore Stephens. The firm said the rise has been fuelled by graduates launching businesses after failing to get a job due to the credit crunch.

The Press and Journal, Page: 33 The Scotsman, Page: 34


London’s future looks bright

A new European economic index from Lasalle Investment Management has found that London has the best economic prospects of any big European city despite the uncertainty caused by Brexit. Mahdi Mokrane, head of European research and strategy at Lasalle, said that London attracted talent “due to its unique mix of business-friendliness and strong human capital”.

The Times, Page: 43


Chancellor urged to reduce tax to boost healthy living

Health experts have called on Philip Hammond to introduce tax breaks on gym memberships and home fitness equipment in the Budget in order to improve Brits’ activity levels. In a letter to the Chancellor, leading figures from the health sector warn that the UK is now one of the least active countries in the world. They recommend offering financial incentives to workers through a £145m-a-year Workout from Work scheme, which analysis shows could boost the economy by £2.60 for every £1 invested, in terms of improved health.

The Daily Telegraph, Page; 4

Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Monday 22nd October 2018

News Roundup Monday 22nd October 2018



Global agreement on tax desperately needed, says OECD

The Organisation for Economic Co-operation and Development (OECD) has called for an urgent crackdown on tax avoidance, as head of tax Pascal Saint-Amans revealed that roughly £190bn a year was lost through profit shifting. He added that “global tax rules must be changed to prevent tech firms from dodging taxes […] you need all the countries in the world, starting with the US, to agree on a set of rules that would allow you to tax without a physical presence.”

Daily Mail, Page: 82

EU wants Brexit deal to strangle future UK tax policy

Leaked documents drawn up by EU officials show Brussels intends to tie the UK’s tax policy to that of the EU after Brexit as part of any future agreement. Papers written by the European Parliament’s TAX3 secretariat and seen by the Telegraph disclose a plan to force the UK to “abide by the tools adopted at EU level to fight tax evasion/avoidance.” The diktat would also apply to UK overseas territories and would prevent the UK from becoming a low-tax economy by cutting its corporation tax rate to attract business. John Longworth, co-chairman of Leave Means Leave said, “the EU will stop at nothing to stifle Britain’s competitiveness post Brexit. An agreement on tax provisions would of course also bind us to future regulations. If they are keeping this ­secret, what else are they planning for us?” The documents were written up by TAX3 following a meeting with Michel Barnier’s Brexit Task Force last week. The minutes of the meeting describe Chequers as “wishful thinking” and state: “According to the Commission, it is not feasible that the political declaration will not include taxation provisions.”

The Daily Telegraph, Page: 1, 2

Chancellor to unilaterally tax online giants

The Mail’s Alex Brummer claims Philip Hammond is preparing to “go it alone” and craft a new tax for internet giants after growing frustrated at progress from the EU, which Treasury officials say has been stymied by lobbying from low tax countries like Luxembourg and Ireland. Separately, the Chancellor has reportedly dropped plans to put VAT on private school fees.

Daily Mail, Page: 12 The Sun, Page: 8

The tax cow that keeps on giving

The Times’ Carol Lewis considers what the Chancellor might do with CGT, IHT and stamp duty in his Budget. Receipts for the three capital and wealth taxes have risen 73% in five years, making up 36% of overall tax receipts, and RSM’s tax partner George Bull thinks cuts to these are unlikely. He says: “The dramatic increase in capital taxes will be welcome news to the Chancellor. It also seems to be in keeping with the spirit of our times, with more people focusing on the taxation of capital or of wealth.” Elsewhere, the FT analyses the rise of IHT receipts over the last decade, noting how a house price slowdown has resulted in growth in estate values levelling off.

The Times, Page: 50 Financial Times, Money, Page: 2

Clegg takes job at Facebook

Sir Nick Clegg has been accused of hypocrisy after taking a high profile PR role with Facebook despite criticising the social media company for paying too little tax. Lib Dem leader Sir Vince Cable said he intended to write a letter to Clegg asking him to get his employer to pay more tax. “I will be urging him to make sure Facebook co-operates with attempts to make sure they pay their fair share of taxes,” he said. “That is the big public policy issue.”

The Daily Telegraph, Page: 1, 2 The Guardian, Page: 3 The Times, Page: 3 The Sun, Page: 11 The Scotsman, Page: 5

HMRC delays rollout of digital VAT returns

Filing VAT returns using the Making Tax Digital system will be delayed for some companies due to the complexity of the system, customer concerns and Brexit complications, HMRC has said.

Financial Times, Page: 2

Pension tax raid ‘will widen retirement funds gap’

A raid on pensions tax relief in the Budget will widen the gap between the retirement funds of public and private sector workers, a report has warned. Last week Philip Hammond said pension tax breaks have become “eye-wateringly expensive” in a clear indication they could be cut in the Budget. However, analysis by the Taxpayers’ Alliance suggests that stripping back tax relief on money saved into pensions would hit private sector workers significantly harder than their public sector equivalents, who already enjoy more generous arrangements. If pension tax relief is limited, the analysis found, a private sector worker earning £72,000 would subsequently have to pay around a fifth more in increased tax than their public sector counterparts to build up equivalent pension.

The Sunday Telegraph, Page: 2

Shops set for £300m tax cut

Philip Hammond could announce a £300m tax cut for shops in Britain’s most deprived town centres from April, as pressure mounts on the Government to help high street retailers. A source quoted by the Mail on Sunday said the Government is weighing up an instant reduction in bills for the next two years, along with a package of measures that could include a tax on digital firms. It is facing growing pressure to level the playing field on tax to help domestic firms, as criticism mounts against multinationals using complex company structures to reduce their tax bills. The Tax Justice Network has called on ministers to demand greater transparency from global corporations operating in the UK, arguing that that powers enshrined in the Finance Act 2016 gives the Treasury the ability to demand firms publicly state country-by-country financial data.

The Mail on Sunday, Page: 97

Pension switch could land grieving families with IHT bills

The families of people who cashed in final salary pensions while terminally ill could face huge IHT bills following a landmark ruling. The Court of Appeal last week ruled in favour of HMRC after it launched a legal case against the family of Rachel Staveley, who transferred her money from one pension scheme to another in 2006 while terminally ill and died before accessing any of the cash. HMRC said that Ms Staveley knew she had a terminal condition and had deliberately not accessed the money, to prevent her family from paying IHT.

The Sunday Times, Business, Page: 13

HMRC expands football probe

HMRC is now investigating almost 200 footballers for alleged tax abuses linked to image rights payments. Tax officials are probing 198 players at 44 Premier League and Football League clubs, as well as 29 agents. The number of players under investigation has risen from 181 in April, while the number of agents under HMRC scrutiny has increased from 21 to 29 in the same period. The football investigation has so far netted £329m in extra tax for the Treasury, with several clubs having settled with HMRC during the year.

The Mail on Sunday, Page: 132

Budget offers chance for reform

The Sunday Times’ Tommy Stubbington says Philip Hammond should use this month’s Budget to ask “some fundamental questions about the tax system.” He argues that the chancellor should target some of the loopholes that “distort the tax system with perverse incentives and amount to absurdly generous giveaways to some of the wealthiest citizens.” Amongst the areas most ripe for reform are CGT, IHT and pensions, says Stubbington.

The Sunday Times, Business, Page: 4


No-deal Brexit poses risk to jobs

The Federation of Small Businesses has warned that a no-deal Brexit would result in small companies postponing investments and cutting their workforce. The FSB found that more than one in three SMEs would postpone big business decisions or investment in research and development if Britain left without a deal. Meanwhile, one in five firms said they were likely to make redundancies or cut spending. Separate research from Citibase found that 60% of SMEs have started or are about to start making Brexit contingency plans.

The Times, Page: 42 The Scotsman, Page: 39

Business owners warned over loss of relief

Gibson Hewitt director Lynn Gibson is warning business owners who may be considering retirement to make plans to put their firms into a Members’ Voluntary Liquidation (MVL) ahead of the Budget this month amid rumours the Chancellor is considering shutting down Entrepreneur’s Relief. The relief has made taking money out of a company more tax efficient. As such, it continues to be used by business directors and shareholders when they are looking to sell or close their company,” explained Lynn. She added: “Those who are considering an MVL in the near future should look to bring their plans forward if at all possible, as a sudden change in the Autumn Budget may make this form of winding up order less tax efficient than other options, such as succession or a buyout.”

Press Release

Funding Circle recovers after loan book lift

Shares in peer-to-peer lender Funding Circle recovered on Friday after a poor start as a public company. Share rose 4.9% to 430p after it revealed its loan book had expanded 61% by the end of September. Funding Circle said its total loan book was worth £2.8bn by September 30, up from £1.7bn on the previous year. Investors funded a record £564m of new loans in the third quarter and £1.6bn in the year-to-date. More than £1bn of this was lent to SMEs in the UK.

Daily Mail, Page: 105 Financial Times, Page: 17

Philip Hammond targets £2bn job subsidy to make Budget savings

Philip Hammond is looking to scale back the Employment Allowance, which takes the first £3,000 off every company’s bill for employers’ NI and is costing £2bn a year, possibly restricting it to micro-businesses.

Financial Times, Page: 2


GVC finance boss moves to private equity

The CFO of GVC Holdings is to leave the gambling operator after less than seven months in the role. Paul Bowtell is leaving to join Alchemy Partners.

The Times, Page: 49

Patisserie Valerie may face legal action from investors

Law firm Teacher Stern is canvassing Patisserie Valerie investors about a possible legal action following the discovery of “significant, and potentially fraudulent, accounting irregularities.” The law firm wants to pursue the café chain for losses endured by shareholders. Philip Rubens, head of financial services litigation at Teacher Stern, has also suggested that Patisserie Valerie could take action against its auditor Grant Thornton. Meanwhile, Iain Cowie in the Sunday Times says Patisserie Valerie’s predicament should serve as “a warning to anyone who thinks tax-efficient investing is a piece of cake.”

The Sunday Times, Business, Page: 3 The Mail on Sunday, Page: 99


New pensions death tax risk

HMRC has won a controversial appeal case that means the pensions of savers in ill-health face being taxed if transferred to loved ones. Tom Selby, of AJ Bell, said the ruling caused “major confusion for pension savers in ill-health” and risked landing families with a “shock 40% tax bill on the money left behind by a loved one”. He added: “Instead of allowing court rulings to determine whether inheritance tax is due on retirement funds left behind, the Government could radically simplify the system by exempting pensions from inheritance tax altogether.”

The Daily Telegraph

HMRC reduces check facilities for incorrect pension records

Changes to the way HMRC checks company pension schemes mean up to a million pensioners could be stuck with incorrect payments after the end of this month. State and final salary employer pension holders who reached state pension age before April 6, 2016 will be affected by HMRC’s decision to shift to only checking errors in company pension schemes on a case-by-case basis, a move that will slow down the process of revising records and could leave pensioners stuck with incorrect payments.

The Daily Telegraph, Money, Page: 7


Downward trend for stamp duty receipts could cost treasury £1bn this year

Official figures released yesterday show a £542m fall in stamp duty receipts to £6.5bn so far this year – a 7.7% drop on the same period last year. Mark Littlewood, director general at the Institute for Economic Affairs, said: “Stamp duty is a bad tax […] Ultimately this pernicious tax needs to be scrapped to increase efficiency in the housing market and bring down prices.” Elsewhere, John Hawksworth, chief economist at PwC, said: “Stamp duty has been weaker than expected, reflecting lower housing transactions in London in particular.”

Daily Mail, Page: 12


ICAEW CEO writes to Chancellor

In a letter to the chancellor Philip Hammond, the CEO of ICAEW, Michael Izza, suggested ways to keep the UK economy competitive. He called on Mr Hammond to slow down the introduction of new tax legislation and for the National Productivity Council to assess the impact of regulations on productivity growth. To support businesses in the future, Izza said ICAEW hoped that the profession would be afforded mutual recognition in regards to professional qualifications. Izza also claimed there was a need for the UK to close the skills gap, through the government boosting technical education programmes and by recognising difference in the availability of skilled staff in different regions.


Food sales down

Food sales saw their steepest drop in three years in September as consumers tightened their belts after the unusually hot summer, the ONS has said. Sales of food were down 1.5% in the month, contributing to a 0.8% fall in total UK retail sales. Andrew Westbrook, head of retail at RSM, said: “There continue to be signs of distress on the high street, with deep discounting evident in some stores. For many retailers the run-up to the Christmas season when stock can be converted to cash can’t come soon enough.”

The Times, Page: 44

Deutsche Bank chief economist: UK is going to come out just fine

Deutsche Bank’s Chief Economist David Folkert-Landau, has said Britain’s economy will do “just as well, if not better” than that of the EU. He told Bloomberg: “I believe over a generational period the UK is going to come out looking just fine. The UK economy has flexibility, it is in its genes to do well, to be innovative. It doesn’t have this bureaucratic construct that the Europeans have to struggle with, and it’s got flexible exchange rates.”

Daily Express

Government borrowing drops

The ONS has revealed that government borrowing fell by more than expected last month, to £4.1bn from £4.9bn a year earlier, the lowest borrowing figure for the month of September since 2007. Public sector net debt, excluding public sector banks, now stands at £1,789.5bn, equivalent to 84.3% of GDP. John Hawksworth of PwC said: “This borrowing undershoot should give the Chancellor a little extra wiggle room for his Budget, but it will not be enough on its own to cover the cost of announced increases in spending on the NHS, let alone other priority areas where there is pressure to bring austerity to an end.”

BBC News City AM Financial Times The Daily Telegraph, Business, Page: 31 Daily Express, Page: 4 The Times, Page: 50 The Guardian, Page: 33

Carney: Banks can cope with no-deal

The Governor of the Bank of England, Mark Carney, has said that Britain could withstand a hard Brexit and tough trade relations after Britain leaves the EU. The BoE does not see the scenario as the most likely outcome in March next year, when Britain formally leaves the EU, but it is still possible. Mr Carney said: “We aren’t hoping for the best, we’re preparing for the worst in several ways.”. Mr Carney added that about £100trn of cross-border derivative contracts may be disrupted by loss of regulatory permissions for clearing houses after Brexit.

The Times, Page: 50

Wages expected to rise

Economists are expecting pay to rise by 3% next year while inflation will slow to 2%, meaning that real incomes will rise by 1% in 2019. When a fuller picture of living standards is included, economists predict real household disposable income growth of 1.4% next year, almost three times the OBR’s forecast of 0.5%. Peter Dixon at Commerzbank commented: “Personal incomes were remarkably weak through 2016 and 2017, growing [in cash terms] by 2.25%. We think this year that will be closer to 4% and similar next year.” The Telegraph explains that the recovery has been caused by a strong jobs market, with very low unemployment, which has pushed employers to raise wages.

The Sunday Telegraph

Profit warnings increasing

Retailers issued eight profit warnings in the past three months, according to EY’s profit warning stress index – the joint highest third quarter figure since the credit crunch. In total 206 listed companies have issued profit warnings in the past 12 months, up from 191 a year ago. EY attributed the rise to the ongoing pressures facing the high street and consumer-facing businesses, as well as the economic uncertainty caused by Brexit and rising regulatory, wage and commodity costs.

The Sunday Telegraph, Business, Page: 3 Sunday Express, Page: 55


German investigation into tax wheeze spreads to Spain’s Santander

Banco Santander has confirmed it is “fully cooperating with German authorities” who are looking at the bank’s role in an alleged tax-evasion scheme. The scheme let shareholders use a loophole to claim tax refunds on dividends they may not have been entitled to. It is claimed that Germany and at least ten other European countries lost out on £48.6bn of tax.

Financial Times, Page: 13 Daily Mail, Page: 82

Refugee tax break for French

French households will be able to claim tax breaks worth up to €1,500 a year if they open their home to a refugee.

The Times, Page: 39


Name checks to begin on bank payments

As part of plans to combat fraud, the name of someone receiving a payment will be as important as their bank details for the first time from next summer. The plans, which have been revealed by Pay UK, will alert the sender if the name does not match the account. It is designed to combat cases when fraudsters mimic a genuine business and attempt to trick people into sending money to an account controlled by the con-artist.

BBC News Daily Mail, Page: 8

Ranks of UK ultra-rich swells

A report by Credit Suisse shows the number of ultra-high net worth individuals (UHNWIs) in Britain – those with fortunes of more than $50m (£38m) – rose over the 12 months to summer 2018 by 8.5% to 4,670, while the average Briton saw their wealth, including property, grow by 1% to £213,000.

The Guardian, Page: 2

Property sale to clear Dwight Yorke’s tax debts

Former Manchester United and Aston Villa striker Dwight Yorke is hoping the sale of a £2m property will allow him to clear a £1.5m tax debt and avoid bankruptcy.

Daily Mirror, Page: 15

Families battling for fortunes

The Sunday Times’ Kate Palmer highlights the soaring numbers of siblings, stepchildren and partners who are contesting wills and inheritances in an effort to get their hands on family fortunes. Ministry of Justice figures show the High Court considered 145 inheritance disputes last year, slightly down on the record of 158 in 2016 but three times higher than a decade earlier.

The Sunday Times, Business, Page: 13

1D’s biggest hit

One Direction have been hit with a £24.7m tax bill during their hiatus. The boyband have appealed the ruling, which is believed to be one of the biggest such debts in pop history.

The Sun, Page: 22-23

Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Friday 19th October 2018

News Roundup Friday 19th October 2018



Businesses are being persuaded to follow the “spirit” of tax law

Paul Monaghan explains in the i how companies such as Facebook, Apple, Amazon, Netflix and Google use complex financial arrangements to reduce their tax liabilities and how these measures have contributed to their success. But, says Monaghan, there is a growing sense in business that the “spirit” of tax law should be adhered to and more are “going above and beyond the legal minimum requirements” because they believe “paying the right amount of tax is part of the social contract that helps build a great community.” Monaghan urges people to lobby and campaign to speed up this change and get more companies to sign up as Fair Tax Mark organisations.

The I

Golden passport schemes a tax and security risk

The EU justice commissioner has warned that so-called “golden passport” schemes are putting Europe’s security at risk. Vera Jourová said the programmes, which allow states to sell citizenship or residency, were a gateway for dangerous individuals to have access to the whole of the EU. Her comments came as Malta and Cyprus were named on an OECD blacklist of 21 nations operating passport schemes deemed to pose a high risk of tax evasion.

The Guardian, Page: 1, 4

Royal Mail assures MPs new boss will pay UK tax

The Royal Mail was criticised yesterday for its “complacency” over “excessive executive pay” with MPs hitting out at the company after remuneration committee chair Orna Ni-Chionna admitted a £5.8m payout to Royal Mail’s new Swiss-based boss, Rico Back, did not incur UK tax liability because he was based at Royal Mail’s European parcels business General Logistics Systems in the Netherlands. Royal Mail said the Switzerland-domiciled Mr Back would pay UK tax on his salary.

Daily Mail, Page: 68 i, Page: 10 The Times, Page: 43 The Daily Telegraph, Business, Page: 3 The Times, Page: 41 Daily Mirror, Page: 38

Fox – Trade dividend will remove need to raise taxes

The international trade secretary has claimed a post-Brexit trade boost will bring in £50bn, removing the need to raise taxes or cut spending in order to invest more in the NHS. Liam Fox told the inaugural international trade banquet at Mansion House last night: “As a government, we have been elected to be fiscally responsible whilst, of course, continuing to fund public services. This can only be achieved through a strong economy that generates extra revenue without increasing the individual tax burden. But fiscal balance is not solely about whether to raise taxes or cut spending – it is also about how to generate more revenue by growing the economy domestically and selling more of our goods and services abroad.”

The Times, Page: 36

Fix rates and corporation tax first – Asos boss

Nick Beighton, the chief executive of online fashion retailer Asos has said rather than introducing a new digital sales tax, the Government should concentrate on reforming business rates and preventing corporation tax “leakage”.

The Guardian, Page: 33 Daily Mirror, Page: 48


Fox – Trade dividend will remove need to raise taxes

The international trade secretary has claimed a post-Brexit trade boost will bring in £50bn, removing the need to raise taxes or cut spending in order to invest more in the NHS. Liam Fox told the inaugural international trade banquet at Mansion House last night: “As a government, we have been elected to be fiscally responsible whilst, of course, continuing to fund public services. This can only be achieved through a strong economy that generates extra revenue without increasing the individual tax burden. But fiscal balance is not solely about whether to raise taxes or cut spending – it is also about how to generate more revenue by growing the economy domestically and selling more of our goods and services abroad.”

The Times, Page: 36

Fix rates and corporation tax first – Asos boss

Nick Beighton, the chief executive of online fashion retailer Asos has said rather than introducing a new digital sales tax, the Government should concentrate on reforming business rates and preventing corporation tax “leakage”.

The Guardian, Page: 33 Daily Mirror, Page: 48

Better cyber security reporting will help build a more secure digital society

Writing in City AM, Richard Horne, a cyber security partner at PwC, says although it is understandable that companies do not want to advertise their preparedness for cyber attacks, it is important for them to show “they really understand the risks they’re exposed to and that they have the right structure and people in place to tackle them.” Investors, regulators, and the public are demanding more transparency, adds Horne, who outlines seven ways organisations can start improving cyber reporting in a new paper out today.

City AM, Page: 24

MPs set to call in Johnson, Grant Thornton over cake chain failures

Patisserie Valerie boss Luke Johnson and auditor Grant Thornton face being summoned by MPs to explain how a black hole in its accounts was missed. Labour MP Peter Kyle, a member of the business select committee, said: “Patisserie Valerie’s situation only exemplifies the need for a wholesale look at how we ensure our companies get the right governance and the right external scrutiny, so that shareholders, customers and our broader economy can be reassured that best practice is being followed.” Committee chair Rachel Reeves said Grant Thornton had questions to answer, stating: “The rising number of accounting failures undermines trust in business and it’s vital that Government and regulators take action to ensure that audits provide a true picture of the financial position of the firms they audit, not works of fiction.” She added: “The audit industry is simply not fit for purpose. The government needs to quickly get a grip of the audit industry if we are to get audits that business, investors, and employees can believe in.”

Daily Mail, Page: 70, 71

Refining the definition of a good auditor

Rodger Hughes says the problem with the audit market is not competition, rather it is audit quality, which is being compromised by “individual behaviour influenced by culture.”

Financial Times, Page: 12


Small businesses gain access to Financial Ombudsman Service

The Financial Conduct Authority has announced that that small businesses, with annual turnovers of below £6.5m, can now utilise the Financial Ombudsman Service to complain about banks. This means an additional 210,000 SMEs will have access to redress via the free-to-access ombudsman rather than taking a complaint through courts. Although small company representatives welcomed the move, they said there remained questions over the ombudsman’s ability to take on the extra workload and the fairness of the claims process, which Nick Stoop of Warwick Risk Management says is weighed in favour of banks.

Financial Times The Sun, Page: 45 The Times, Page: 51 Daily Mail, Page: 68 The Daily Telegraph, Business, Page: 7 Yorkshire Post, Page: 17

Half of SMEs cite Brexit as biggest concern

A survey by Western Union Business Solutions reveals one in three professionals managing international payments at SMEs say uncertainty around Brexit has made forward planning “not easy” or “not easy at all” while over one in four say economic uncertainty is their biggest barrier to trade. Almost half identify it as their biggest concern for their future international trade and payments needs. Additionally, one in four say that they could only tolerate a 5% negative FX move before facing financial difficulty, with this figure jumping to one in three in the event of a 10% unfavourable FX swing. Consumers have borne the brunt of currency volatility with up to a third of firms passing on costs to clients.

Business Matters

SMEs should get Brexit contingency planning vouchers, says IoD

The Institute of Directors has suggested that SMEs be given vouchers that can be exchanged for advice on how to prepare for Brexit. The employers’ group urged Philip Hammond to use his budget this month to help companies buy legal and other professional advice in order to better make contingency plans.

The Times, Page: 51

Big groups should lose contracts for frequent late payments to suppliers, body warns

The Federation of Small Businesses has urged the government to legislate to protect suppliers from large companies who regularly pay late, and to strip them of government contracts if necessary.

Financial Times, Page: 3

Midsized UK businesses turn sour on Brexit

A quarterly Brexit Monitor from RSM has found that more companies now believe Brexit will damage their business than help them. Sentiment on the impact of Brexit on business, measured by YouGov, dropped from 113 in the second quarter of 2018 to 99 in the third quarter. Meanwhile, research by Atomik on behalf of Citibase has found that 59% of 1,046 SMEs want to see a snap general election as soon as Britain leaves the EU next March. Confidence in the Government to deliver a good deal for SMEs has fallen to 52%, down from 58% the previous quarter, while the number believing the Government will finalise negotiations by March has fallen from 62 to 54%.

Financial Times Daily Express

Firms struggling to fill roles

As many as 80% of SMEs say that they are struggling to attract staff with the relevant skills, according to recruitment consultancy Robert Half, with employers forced to offer increased salaries in an attempt to attract talented candidates. Matt Weston, UK managing director at Robert Half, said: “Technology and digitalisation is rapidly changing the UK business landscape. This, coupled with Brexit uncertainty, means businesses must adapt their recruitment strategies to ensure they are equipped with the right talent to keep up. However, the skills desired within certain roles remain specialist and unobtainable without presenting a competitive offer. The skills required are changing at a faster pace than their adoption among the mainstream UK workforce.”

The Times, Page: 43

Northern start-ups attracting plenty of VC cash

More than $49m was pumped into Northern start-up businesses by venture capital investors between July and September, up by nearly $10m on the same quarter last year, according a quarterly report from KPMG. Graham Pearce, KPMG’s head of technology in the North, said: “The third quarter of the year is traditionally a slower period for investment. Add to this the shadow of Brexit uncertainty, and it’s great to see the amount of VC investment in the North’s thriving start-up and scale-up sector up on the same period a year ago.”

Yorkshire Post, Business, Page: 5


Former OFT boss warns over ‘radical’ M&A regime changes

John Fingleton, former head of the Office of Fair Trading (OFT), has spoken out about the government’s “radical” M&A proposals, warning that they could create regulatory bureaucracy and hit foreign investment. Fingleton told the Radio 4 Today Programme: “The scale of it is almost industrial. We’ve had nine national security cases in the last 15 years, they’re proposing 100 cases a year under the new system.”

City AM Financial Times, Page: 3


Jamie Oliver Group finance executive quits

James Gregory has left Jamie Oliver Group, becoming the third finance executive to leave the TV chef’s business in just over a year. He has been replaced as CFO by Pamela Lovelock.

City AM

New JD Sports CFO named

JD Sports has said finance director Neil Greenhalgh will become CFO after Brian Small retires at the end of the month.

Daily Mail, Page: 69

Crest Nicholson CFO stepping down

Crest Nicholson has posted its third profit warning in two years, along with confirmation that its chief financial officer Robert Allen is stepping down. The housebuilder blamed the uncertain political environment and a tough housing market.

The Daily Telegraph City AM The Times, Page: 41 Daily Mail, Page: 72

Morrisons’ finance boss rewarded

Morrisons’ finance chief Trevor Strain is taking on extra duties as commercial director in a promotion that sees him strengthen his position underneath boss David Potts. He has steered the battle-worn supermarket to steady growth, having led Morrisons’ turnaround plan for the last four years.

City AM Yorkshire Post, Business, Page: 1

Hamleys FD Jablonowski on way out

Hamleys is replacing its finance chief Alex Jablonowski with Yong Shen, the former financial officer of House of Fraser, later this month.

Daily Mail, Page: 73


London weighing on UK house price growth

House prices rose 3.2% in the year to August, the slowest pace of growth since August 2013, according to the ONS, taking the average UK house price to £232,797. Howard Archer, chief economic adviser at EY ITEM club, said: “Additionally, housing market activity remains hampered by relatively fragile consumer confidence and limited willingness to engage in major transactions.”

Financial Times City AM The Guardian, Page: 62 The Times, Page: 41 Daily Mail, Page: 14


Confidence drops amid concern over debt and income

Consumer confidence has taken a dive for the first time in more than a year despite firmer UK activity and falls in unemployment. A poll by Deloitte found concerns over disposable income and debt levels had led to a “softening in consumer confidence”. Deloitte’s chief economist, Ian Stewart, said the fact that the positive backdrop had failed to boost confidence was a testament to the “headwinds from inflation, interest rate rises and Brexit.” Employees’ average weekly earnings received a rise of 3.1% excluding bonuses in the three months to the end of August, according to data from the ONS, and 2.7% including bonuses. However, inflation ate into the gains – cutting wage growth in real terms back to 0.4% including bonuses.

The Times, Page: 44 City AM, Page: 2 Financial Times

Exporters shrug off Brexit woes

A study by Santander reveals that 70% of trading firms expect to expand their international activity over the next 12 months, shrugging off any disruption that may be triggered by Brexit. However, 43% of respondents said that Brexit would negatively affect their operations. Baroness Fairhead, the exports minister, said that the report “highlights the growing sense of ambition and drive to export among UK businesses.” John Carroll, head of Santander UK’s international division, said: “Brexit is not deterring many from pursuing growth opportunities in the European Union and farther afield.”

The Times

Scottish retailers enjoy growth

A new report from the Scottish Licensed Trade Association, sponsored by KPMG, showed 49% of hospitality and leisure businesses are currently experiencing growth, compared with 39% half a year ago. However, the pub sector remains under pressure and fears a tax hike on beer could lead to job losses and closures.

The Scotsman, Page: 37 Aberdeen Press and Journal, Page: 13, 33

Falling inflation lowers rate rise potential

The consumer price index (CPI) fell to 2.4% in September, from 2.7% the previous month, the Office for National Statistics has said, data which is likely to dissuade the Bank of England from raising interest rates before Brexit in March 2019. The falling price of meat and chocolate helped reduce some of the pressure on cash-strapped consumers.

The Guardian, Page: 31 The Daily Telegraph, Business, Page: 8

BoE highlights corporate debt surge risks

The Bank of England’s Financial Policy Committee is concerned at rising levels of corporate debt, with Sir Jon Cunliffe, deputy governor at the Bank, warning that 20% of corporate borrowing in the UK is now through leveraged loans. Highly indebted companies are increasingly following this borrowing route risking new vulnerabilities in the financial system.

The Daily Telegraph The Guardian, Page: 32 Financial Times, Page: 2


ICAEW champions improved defence spending

In a new paper, published as part of the annual flagship IFS Green Budget, the ICAEW asserts that funding for UK defence spending should improve amid growing international tensions. Overruns are expected in the 2017 to 2027 Equipment Plan to upgrade kit, the body notes, and the challenges in filling technical roles in the Armed Forces and Ministry of Defence may push up recruitment costs.

Press Release

Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Wednesday 17th October 2018

News Roundup Wednesday 17th October 2018



No delay to MTD plans

Business minister Kelly Tolhurst has told small businesses that there will be no further delay to “making tax digital” despite warnings from the Federation of Small Businesses and others that SMEs are not ready for moving tax compliance online and are having to deal with uncertainties around Brexit at the same time. Last month, the ICAEW said 40% of affected businesses were not aware of the change. Ms Tolhurst said: “We’re making sure the communication is there so small businesses know exactly what they’ve got to do. Digitalisation is the way to go. It’s all about making it easier for business, but it’s rightly down to us to sell it to businesses and make sure they understand what the benefits are.” From April, all VAT-registered companies will have to have digital record-keeping for VAT and file VAT returns directly from third-party software.

The Times, Page: 42

EU tax evasion rules full of holes

A report by the European Green party claims that, despite the introduction of the “common reporting standard” in 2017, wealthy people can still hide foreign accounts from tax inspectors. The report said the easiest way for an EU citizen or firm to avoid the automatic exchange of information was to set up bank accounts in one of about 43 countries that have not committed to implementing the rules, or in the US, using a company name. Golden visa schemes also provide a way to investors to shift funds to countries outside the arrangement, while there are no sanctions for tax havens that fail to send the relevant information to EU countries.

The Guardian, Page: 33

Chancellor’s Budget tax plans face Tory challenge

The Chancellor’s scope for tax rises has been limited by the fallout of Brexit talks and a refusal by Number 10 to endorse his claim that tax pledges made in last year’s manifesto are void, the FT says. Elsewhere, the Mail’s Alex Brummer warns Philip Hammond against coming down on pension savers in his Budget. He says: “The tax break on pensions may look ‘eye-watering’ but it is not free money. Citizens pay income tax on that cash, often at higher rates.” Finally, the Telegraph reports on a letter from UK Finance chief Stephen Jones who calls on Hammond to review whether the bank levy may have served its purpose.

Financial Times, Page: 2 Daily Mail, Page: 62 The Daily Telegraph, Business, Page: 6

Church failing to address tax concerns through AGMs

The Church of England has been criticised for raising concerns over the tax affairs of Amazon and Google while failing to push for change at the companies’ AGMs. The Church was found to be a shareholder after the Archbishop of Canterbury slammed Amazon for “leeching off the taxpayer” last month. The Church Commissioners, who handle more than £8bn of assets for the Church of England, have not attended any AGM held by Amazon or Google for at least three years. The Church insisted there were other ways for it to voice its concerns.

The Times, Page: 6

A tax on US tech firms will likely bring retribution

The Times’ Simon Duke considers EU plans to tax US tech firms with a 3% sales levy. Brussels intends to target companies with global revenues of more than €750m in a move likely to draw retaliation from the Trump administration. Mr Duke notes that Philip Hammond appeared to row back on plans to unilaterally implement a tax on online sales when speaking at the IMF’s recent meetings in Bali. A post-Brexit Britain will probably not want to torpedo a possible trade deal with the US with a digital tax, Duke concludes.

The Times, Page: 6

High earners beware of huge pension tax rates

Louise Peters at Johnston Carmichael warns that many professionals approaching retirement are having to choose between paying hefty extra tax bills or agreeing to a reduced pension due to growth in value of their pension fund. The problem is particularly acute for higher earners in generous pension schemes where the combined taxable value of actual income and imputed pension growth exceeds £150,000, says Peters. Annual tax bills of £15,000 to £25,000 are not uncommon.

Aberdeen Press and Journal, Page: 5

May’s pledge to end austerity could cost 1% tax rise

The Institute for Fiscal Studies calculates that Philip Hammond will have to increase income tax, NICs and VAT by the equivalent of one penny in the pound to meet Theresa May’s pledge to end austerity and still continue with his plan to eliminate the deficit. The IFS said in its so-called Green Budget that the alternative to tax hikes would be economic growth that far exceeds that currently predicted. Either way, the chancellor would need to find an extra £19bn a year by 2022 to keep May’s promise. The IFS adds that restricting tax relief on pension saving to the 20% basic rate could save the exchequer £11bn a year but would be “a step in the wrong direction”.

The Daily Telegraph, Business, Page: 1, 4 Financial Times, Page: 2 The Times, Page: 8 The Times, Page: 38 The Sun, Page: 2 The Daily Telegraph, Page: 2 Daily Mail, Page: 12 The Guardian, Page: 2

UK’s largest businesses receive bumper fines

HMRC has fined some of the UK’s largest businesses around £59m in the past year, according to a report by law firm Pinsent Masons, which says “HMRC imposed the fines on businesses managed by the Large Business Directorate (LBD) for ‘Failure to Take Reasonable Care’ to ensure all information given is correct.” HMRC fined 115 Finance Directors and other senior finance executives in the last twelve months due to failings in their company accounts, the report added, noting that this, paired with ongoing investigations of large companies, has led to HMRC collecting an additional £8bn in tax.

Accountancy Age London Loves Business

IHT issues facing siblings who live together likely to remain

Jacqueline Thomson, a senior manager at BDO, highlights attempts to ensure that siblings who live together, who don’t currently enjoy the tax advantages given to married couples or those in a civil partnership, are not unfairly hit by the inheritance tax threshold. A bill seeking to include sibling couples who have cohabited for 12 years in civil partnerships received its second reading in the House of Lords in July and is awaiting examination at Committee stage, she notes, but will likely join “a list of other pressing matters” competing for government resources.

Daily Mail

Contractor ‘witch hunt’ letter leaked

HMRC is requesting the personal details of contractors working for public sector bodies (PSBs) who are continuing to work outside of IR35 through their limited companies, according to a letter leaked to Contractor Calculator, as part of the tax body’s compliance check for the off-payroll tax. HMRC is also chasing PSBs to provide details of contractors who traded via a limited company previously but have since entered into employment contracts or umbrella company engagements, prompting concerns that it may pursue named individuals for back taxes.

Contractor Calculator

Tax raid on school fees

The Treasury is considering introducing VAT on private school fees in a move that could pull in £1.5bn. But independent schools warn the move could backfire by sending thousands of children back into the state sector at a cost to taxpayers.

Daily Mail, Page: 12


Auditor faces legal action over Patisserie failures

Grant Thornton could be sued by Patisserie Holdings over their alleged failure to spot a £40m black hole in the cake shop operator’s finances. The company found last week that instead of having the £28.8m of cash declared in May, it had net debt of £9.8m, a deficit of £38.6m. Following the revelation, CFO Chris Marsh was arrested and an SFO probe begun. The Financial Reporting Council is also looking into Grant Thornton’s work. Executive chairman Luke Johnson has launched a rescue bid and described the fraud as “a betrayal”. He added that “a number of things” would come out when accounts for the year to September were published and that they would “not be a pretty sight”.

The Times, Page: 35 Daily Mail, Page: 14, 62 The Guardian, Page: 12 Financial Times, Page: 20 Daily Express, Page: 44 City AM, Page: 2


To raise audit standards, you must change accounting standards

As the audit market and its regulator, the Financial Reporting Council face reviews, the FT’s Jonathan Ford asserts that “tick-box” rules disable “auditors’ truth-seeking radars.”

Financial Times, Page: 16

Bank of England tells institutions to prepare for climate change

Banks and insurers are to be instructed to put a senior executive in charge of reporting climate risks to the board and to be accountable if insufficient action is taken to address them.

Financial Times, Page: 15

BlackRock believes FRC must improve as a supervisory agency

Barbara Novick clarifies Blackrock’s opinion of the Financial Reporting Council, stating that it believes the regulator needs to improve as a supervisory agency but a “full overhaul” is not necessary.

Financial Times, Page: 16

There shouldn’t be any accounting ‘rules’ at all

D?R Myddelton agrees that there is a problem with accounting rules but says “in the sense of compulsory instructions” there shouldn’t be any accounting “rules” at all.

Financial Times, Page: 10


Asset seizures rocket in tax clampdown

Nearly 3,000 businesses had assets seized by HMRC last year for not paying tax on time. The increasingly aggressive debt collection policy has led to calls for a review of the approach. The number of firms facing asset seizures jumped 45% from 2016-17 and has increased more than fourfold since 2014-15. Conrad Ford, CEO of Funding Options, said: “HMRC is jeopardising the future of these businesses by removing their assets. There may be a better way for HMRC to recover the tax than removing a business’s vital assets. Cashflow difficulties that mean a business cannot settle its tax bills should not spell the end for them.”

The Independent, Page: 58 City AM, Page: 13

Call for support for importing SMEs

A new report from Bibby Financial Services calls for increased support for importers from the EU as Brexit looms. Bibby’s latest SME confidence tracker found 61% of firms that import from the bloc said they would see a decline in profits if they could no longer access the EU single market, “further demonstrating SMEs’ current reliance on EU suppliers for survival and business growth”. Additionally, 8% of EU businesses have already cut ties with British suppliers.

The Scotsman, Page: 34 City AM, Page: 8

Clampdown on sale of tech jewels could harm SME access to finance

The EEF has warned that new rules on foreign investment could cut off access to capital for UK start-ups. A White Paper on regulations designed to stop strategic companies and technologies from falling into overseas ownership fails to consider the implications for small businesses that are struggling to secure finance domestically, the manufacturers organisation says. Ollie Welch, head of defence, aerospace and security policy at the EEF, said there was a risk start-ups would have the rug pulled from under them unless the rules were more precisely defined.

The Daily Telegraph


Communities depend on thriving high streets

The Mayor of the West Midlands and former MD of John Lewis, Andy Street, says in the Daily Telegraph that while the high street has not yet been killed off by online shopping, creative thinking is required to successfully remodel traditional retail. On taxation, Mr Street welcomes hints that the Chancellor will look to reform taxes for online companies such as Amazon, address the problems with business rates, and agrees that tax policy should also support small businesses. Meanwhile, the boss of retail landlord Shaftesbury, Brian Bickell, has backed calls for higher taxes on online retailers to relieve the pressures of the “out of date” business rates regime on the country’s struggling high streets. Waterstones boss James Daunt also adds his voice to calls for a fairer business rates system.

The Daily Telegraph, Page: 18 The Daily Telegraph, Business, Page: 1 Daily Mail, Page: 62


Fewer consumers visit stores

Analysis shows that footfall on the high street dipped 2.2% in September, with shopping malls seeing a 2.4% drop that marks the 18th consecutive month of decline. Retail parks saw a 0.1% increase in footfall, although growth was down on August where a 0.3% increase was recorded. Helen Dickinson, chief executive of the British Retail Consortium, said the figures are “yet further demonstration of the increasingly difficult operating environment British retailers are facing,” adding a call for ministers to reform the tax system to help the sector.

The Times, Page: 41 Daily Express, Page: 44

High street banks told to assess no-deal exposure

Officials at the Treasury have joined Bank of England regulators in urging banks to assess their exposure to UK sectors seen to be at-risk from a no-deal Brexit. A City source has told the Telegraph that companies assessed to be most at risk of cash flow or credit problems include those reliant on overseas supply chains or just-in-time­ delivery. Those exposed to foreign currency risks have also been identified as potentially hazardous for banks.

The Daily Telegraph, Business, Page: 5

Biotech sector could provide economic tonic

KPMG partner Moray Barber says in the Press and Journal that Aberdeen’s biotech industry is one of the key threads holding together the city’s renewed sense of optimism.

Aberdeen Press and Journal, Page: 11

A third of UK firms expect decline in profits due to Brexit

A survey of finance professionals by the Chartered Institute of Management Accountants has found that 35% of businesses forecast their profits will decline as a result of Brexit, while 27% expect profits to be flat. More than half of respondents said they expect business costs to rise, with 14% forecasting to spend more than £1m on Brexit planning. Some 77% of businesses have taken steps to prepare for Brexit, while 20% have conducted a full risk assessment, the study said.

The Times, Page: 48 The Scotsman, Page: 36


ONS prepares to turn page on economic understanding

The FT considers the new measurement techniques and improved data sources set to be used by the Office for National Statistics to determine the state of the economy and change our understanding of it.

Financial Times

New private sixth-form planned for priced-out middle class

A group of public school teachers are setting up their own sixth-form because lawyers, accountants and other professionals are struggling to afford the fees for independent schools.

The Daily Telegraph, Page: 1

Scots VC deals dominated by healthcare

Healthcare helped Scottish firms more than double the amount raised via venture capital in Q3 from the previous three months, according to the latest Venture Pulse report from KPMG, indicating a very positive prognosis for the sector.

The Scotsman, Page: 35

AI warning

Smith & Williamson has warned companies that fail to adopt artificial intelligence could “disappear in the coming years”.

Daily Mail, Page: 75

Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Friday 12th October 2018

News Roundup Friday 12th October 2018



Hammond could abandon income tax cut

Philip Hammond could abandon plans to cut income tax for millions of working people to help pay for the NHS. The Mail reports that the chancellor is poised to postpone or scrap the manifesto promise to raise the starting threshold for both the basic and 40p rates of income tax in this month’s Budget – a move which could raise £2bn a year. Mr Hammond is also said to be considering reviving a controversial VAT change for small business, which could raise a further £2bn.

Daily Mail, Page: 4

Digital tax needed to tackle tech giants

The Sun’s Mick Hume says the revelation that Facebook paid just £7.4m in tax last year reinforces the need for a digital tax on global tech giants. He accuses tax-avoiding companies of “living on immoral earnings on an industrial scale.”

The Sun, Page: 10

EU aims for new tax on tech giants ‘by Christmas’

A new tax on technology giants could raise £4.4bn a year across Europe, the head of tax for the European Commission has said. Pierre Moscovici said a deal was “doable by Christmas”. However, he warned that if there was no deal by then, it could be the end of next year before it could be reconsidered. Elsewhere, Chris Denning, head of corporate and international tax at MHA MacIntyre Hudson, writes to City AM to warn that “going it alone with a digital tax, as Philip Hammond suggests, could damage the UK from an economic and fiscal competitiveness perspective.”

BBC News City AM, Page: 6, 20

City taxes under threat from Brexit

City minister John Glen has said the government now expects the City of London to lose 5,000 jobs due to Brexit, thereby reducing the £72.1bn in annual tax revenues from the financial services industry.

City AM The Daily Telegraph Daily Mirror The I, Page: 9

Has HMRC misled the NHS on IR35?

Tax professionals have questioned HMRC’s grasp of the laws surrounding IR35, following the exposure of a controversial webinar delivered to the NHS. Guidance regarding employment status from HMRC’s policy advisor on IR35, Mark Frampton, has been described as “misleading” and “inaccurate”.

Contactor Calculator

Cadbury’s owner pays no tax

The Daily Mirror reports that Cadbury’s owner Mondelez UK paid zero corporation tax last year, despite profits of £185m.

Daily Mirror, Page: 1


CMA to conduct review of the audit sector

The Competition and Markets Authority (CMA) has launched a detailed study of the audit sector to examine concerns that it is not working well for the economy or investors. The review will investigate whether the sector is competitive and resilient enough to maintain high quality standards. The CMA has written to the government about its market study and the possible need for legislation to implement its findings and those of the independent review of the Financial Reporting Council led by Sir John Kingman. Commenting on the CMA’s review, a spokesperson for the FRC said: “We have expressed concern about concentration at the top of the audit market so we welcome this announcement.” Michael Izza, ICAEW chief executive, said the news was a “very positive development”. Bosses at each of the Big Four also welcomed the review, with EY chairman Steve Varley saying it was a “golden opportunity fo r the CMA to examine the role audit plays in society”.

Financial Times, Page: 13 The Times, Page: 37 The Daily Telegraph, Business, Page: 1 The Independent The Guardian, Page: 37 Daily Mail, Page: 63 Sky News BBC News Daily Mirror, Page: 38 The Sun, Page: 43 City AM, Page: 4 The Scotsman, Page: 37

Female FDs earn less than male peers

Despite a relatively narrow gender pay gap for accountants more generally, male financial directors earn almost £30,000 a year more on average than their female peers, according to Global Accounting Network, which has blamed an unnecessary focus on existing salary when negotiating remuneration. While the chartered and qualified accountant level pay gap, between males and females, sits at 5.1%, among financial managers and directors, the gender pay gap widens to 31.6% – with women earning an average of £42,674 compared to male colleagues’ £71,986.

Business Matters Magazine

BlackRock offers support to UK accounting watchdog

BlackRock has called for more power to be given to the Financial Reporting Council in its response to a landmark review of the regulator. The FT’s Jonathan Ford suggests the “somewhat insouciant” submission to John Kingman’s review of the FRC will be typical of the view of many fund managers.

Financial Times, Page: 17 Financial Times, Page: 18

Business surveys scrapped in VAT switch

Hundreds of thousands of business surveys are to be scrapped as a result of the ONS switching to VAT data instead. The Monthly Business Survey, which involves 250,000 forms each year, will be abolished.

The Daily Telegraph, Business, Page: 3


RBS boss calls for regulation of SME lending

Royal Bank of Scotland chief executive Ross McEwan has called for improved regulation of small business lending in the UK, acknowledging that the market required proper checks and routes for complaints. Meanwhile, research by SME specialist bank Aldermore reveals almost half of small businesses operate with less than £1,000 in savings – and one in five has none at all.

Daily Mail Daily Express, Page: 47 The Independent, Page: 57 Daily Mirror, Page: 37 City AM, Page: 4

Late payments curbing SME growth

Small business owners have told MPs that chronically slow and late payment of bills is leaving construction firms unable to invest and expand. The business, energy and industrial strategy committee heard that big construction contractors were mistreating their supply chains as a matter of course, damaging productivity in the process.

The Times, Page: 47

Small firms fear VAT Budget raid

Philip Hammond is facing a backlash over plans for a £2bn tax raid on small business in this month’s Budget. The chancellor may decide to drag hundreds of thousands of firms into the VAT system as he looks for ways to balance the books. Mike Cherry, chairman of the Federation of Small Businesses, warned: “VAT is the most time-consuming tax. A small VAT-registered business spends more than a working week every year complying with VAT admin on average.” Meanwhile, the FSB has backed the Association of British Insurer’s #IPTsUnfair campaign against Insurance Premium Tax. Development Manager Claire Reading commented that IPT “deters small firms from making the right choices.”

Daily Mail, Page: 2 Press Release

Exempt small firms from business rates

Senior Conservative MP Sir Geoffrey Clifton-Brown has said small firms should be automatically exempt from paying business rates to help high-street stores faced with an “unfair” system.

Yorkshire Post, Page: 10

SMEs see automation as opportunity

Research from Scott-Moncrieff shows automation, robotics and artificial intelligence have provided business opportunities for almost four out of five SMEs in the UK.

The Scotsman, Page: 35


Tchenguiz invented claims against Grant Thornton

Grant Thornton has accused property tycoon Robert Tchenguiz of playing “tactical games” by bringing a lawsuit against the firm worth hundreds of millions of pounds that it claims is an “abuse of process”. Lawyers for Grant Thornton said that allegations by Mr Tchenguiz that the firm had “fed lies to the Serious Fraud Office” about him were “genuinely preposterous”.

The Times, Page: 42

Director banned over false invoice scam

David Marsden, director of financing company First Capital Factors, has received a ten year ban after heading a false invoice scheme to secure over £4m in illegitimate funds. Marsden instructed a number of his clients to produce false invoices before submitting them to secure funds.

Financial Reporter

Patisserie Valerie uncovers potential accounting fraud

The owner of Patisserie Valerie has uncovered “significant, and potentially fraudulent, accounting irregularities” and discovered HMRC has filed a winding-up petition against one of its subsidiaries. The café chain said it had been notified on Tuesday of accounting irregularities that could mean a “material misstatement of the company’s accounts”. In a separate announcement yesterday, it said HMRC has issued a winding-up petition against Stonebeach, its principal trading subsidiary, relating to £1.14m of unpaid taxes. Patisserie has suspended finance boss Chris Marsh as it investigates and has requested its shares be suspended from trading on London’s AIM market. Grant Thornton, the company’s auditor, had previously flagged revenue recognition as “one of the most significant assessed risks of material misstatement”. PwC is believed to have been called in to carry out a review of accounts and it is also expected that the Financial Reporting Council and Financial Conduct Authority will investigate. Gavin Pearson, a forensic accounting expert at Quantuma, said: “The mention of the word fraud does potentially imply that this is more than purely an accounting issue.”

The Guardian, Page: 27 The Times, Page: 33 The Times, Page: 34-35 The Daily Telegraph, Business, Page: 1 Financial Times, Page; 1 Daily Mail, Page: 67 Daily Mirror, Page: 48 The Sun, Page: 45 Daily Express , Page: 54 BBC News City AM, Page: 1

Tesco chief tells court of profits ‘shock’

Tesco’s chief executive has told a court of his “genuine shock” on learning of the £250m overstatement of the company’s profits. Dave Lewis told Southwark Crown Court he had “no indication at all” of the issue until brought to his attention by the supermarket’s legal department. He was giving evidence in the trial of former Tesco directors for fraud and false accounting.

BBC News Financial Times, Page: 18 The Times, Page: 41

Firms may have to report ethnicity pay gap

Companies may be forced to reveal their ethnicity pay gap under plans unveiled by the Prime Minister to help minorities at work. Theresa May has launched a consultation on whether mandatory reporting will help address disparities between the pay and career prospects of minorities. The move follows the decision to make firms reveal their gender pay gaps.

The Times, Page: 1 Financial Times, Page: 3 Daily Mail, Page: 1 The Daily Telegraph, Page: 1 The Guardian, Page: 18 The Independent, Page: 3

Fourth time lucky for Domino’s?

Domino’s has appointed David Bauernfeind as its fourth finance chief in four years. He previously served as CFO of Swindon-based distributor Connect Group.

City AM, Page; 11


Tax purge slashes flow of offshore pension cash

Fresh figures indicate that the 25% tax charge imposed on transfers of UK pensions to Qualifying Recognised Overseas Pension Schemes (Qrops) have significantly stemmed outflows of retirement cash abroad.

Financial Times


BoE warns of risky business debt

The Bank of England has expressed concern about the rapid growth in lending to risky UK businesses. The Bank’s Financial Policy Committee said there had been £31bn of loans this year to companies that already had a high level of debt. The £31bn total of so-called “leveraged loans” to highly indebted businesses compares with £10bn of standard lending by UK banks to this type of company.

BBC News

Britain vulnerable to recession, says IMF

The IMF has warned that the underlying state of Britain’s finances is one of the worst in the world following the 2008 financial crash, leaving it dangerously exposed to a recession. The financial watchdog calculated the net worth of 31 countries and found that almost £1trn had been wiped off the wealth of the UK’s public sector – equivalent to 50% of GDP – putting it in the second weakest position behind Portugal.

The Times, Page: 37, 40 The Guardian, Page: 35 City AM, Page: 6


BoE predicts new dawn for pay growth

The Bank of England’s chief economist has said a “new dawn” is breaking for pay growth. Andy Haldane said the Bank’s database of wage settlements showed strong evidence of an upward shift in pay in the private and public sectors. However, he also warned that increased automation in the workplace could lead to weaker wage growth and a smaller share of national income going to workers.

The Daily Telegraph The Times The Guardian, Page: 29

Hot summer heats up economy

The UK economy grew by 0.7% in the three months to August, buoyed by the hot summer, according to the ONS. However, it also said that in August, GDP growth was flat. Economists had predicted 0.1% growth. The three-month measure was the fastest pace of growth since February 2017, economists said.

Financial Times, Page: 2 The Times The Daily Telegraph, Business, Page: 3 Daily Express, Page: 54 The Guardian, Page: 27

Criminal accountant ordered to pay £1.7m

An accountant who funded a flamboyant lifestyle by running Britain’s biggest synthetic drug racket has been ordered to pay £1.7m. Paula White, 49, made more than £12m from a global crime operation and was jailed in 2015 for nine years. She was brought before Carlisle crown court yesterday and ordered to surrender some of her criminal gains or face another eight years in jail.

The Times, Page: 5

Lobby group wants levy on consumers to help foot fraud bill

UK Finance has suggested consumers should pay a tax on all payments to help foot the bill for compensating victims of fraud. The lobby group’s chief executive Stephen Jones told the Treasury committee that lenders should not always be on the hook for payouts when criminals trick people into transferring money into their bank accounts.

The Daily Telegraph, Business, Page: 1

Woman who spent £16m in Harrods revealed

A woman who spent £16m at Harrods in a decade has been identified as the target for the UK’s first Unexplained Wealth Order. Zamira Hajiyeva lost a legal battle to stay anonymous after the media argued the public should know the full facts. She risks losing her £15m home near the London store if she fails to explain the source of her wealth to the High Court.

The Independent Financial Times The Times
Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Wednesday 10th October 2018

News Roundup Wednesday 10th October 2018



Call for tech tax to fund business rate freeze

A coalition of Britain’s biggest restaurant and pub owners has called on the government to undertake a “root-and-branch reform” of the tax system, including a freeze on business rates and a levy on tech giants. In a letter to the chancellor, hospitality companies including Slug and Lettuce owner Stonegate, Pizza Express and Wagamama call for a tax on internet giants to be included in the Budget. The sector’s major players said the proceeds of a levy on Google and Facebook should be used to fund a freeze on business rate increases to ease the pressure on bricks-and-mortar outlets.

The Daily Telegraph, Business, Page: 1

Pension tax relief cut to pay for NHS

Philip Hammond is expected to announce in the Budget that pension tax relief will be cut to pay for the NHS. Last week the chancellor gave his strongest suggestion to date that he will raise taxes to fund the Government’s £20bn funding boost for the health service. Official figures put the cost of pensions tax relief to the Treasury at £39bn a year. It is understood the tax relief is likely to be amended in one of two ways – either by cutting the tax-free annual allowance, or by lowering the rate of relief.

The Daily Telegraph, Page: 2

PayPal tax bill jumps after review by HMRC

PayPal’s UK subsidiary has agreed to pay an extra £3.1m in tax following a review by HMRC. Newly-filed accounts show total tax at the digital payments firm rose from £181,000 in 2016 to £4.7m last year. In the documents, PayPal says: “HMRC has been reviewing the company’s direct tax position. As a consequence, the company has agreed and settled its outstanding liabilities and as a result is not subject to any current enquiries.”

BBC News

Tax probe adds to pressure on Airbnb

Airbnb has revealed in a filing to Companies House that it has been “contacted” by HMRC “regarding the application of tax laws or regulations impacting the company’s business”.

Financial Times, Page: 20

Hammond urged to act over ‘paltry’ Facebook tax bill

Philip Hammond is facing fresh calls to introduce a digital tax in the Budget this month after it emerged that Facebook paid just £7.4m in corporation tax last year. The company’s revenue hit £1.2bn, an increase of more than a third year-on-year. Meg Hillier, Labour chairwoman of the public accounts committee, commented: “Facebook’s paltry UK tax bill underlines the unfairness of the current tax system, which allows multinational digital giants to use every loophole to reduce their bill while bricks-and-mortar high-street businesses are hit hard.”

The Times, Page: 1 The Daily Telegraph, Business, Page: 5 The Sun, Page: 1 The Guardian, Page: 6 The Independent, Page: 60 Daily Mirror, Page: 6 City AM, Page: 12

Parents give away £227bn to save on IHT

Research from Direct Line reveals a fifth of parents have given money to their children in an attempt to reduce the amount of inheritance tax their families will have to pay when they die. A total of £227bn has been transferred, with the average value of assets given away £32,920. A further 19% of parents have not given their children any money yet, but plan to do so in the future.


Hammond eyes tax swoop to pay for Budget promises

Philip Hammond is considering a range of options to raise money for the NHS, including cutting pensions tax relief, delaying plans to raise income tax thresholds and overhauling VAT rules. However, the Mail reports that some Conservative MPs fear a pensions tax raid in the Budget will hit core Tory voters.

Financial Times, Page: 2 Daily Mail, Page: 2

Cut rates to get growth

The Telegraph’s Matthew Lynn argues that cutting corporation tax to 10% and reducing the standard rate and top rate of tax would boost economic growth and lead to higher interest rates. Elsewhere, the Guardian’s Polly Toynbee expresses doubts that businesses and the super-rich would leave Britain in the event of higher taxes under a Jeremy Corbyn-led government.

The Daily Telegraph, Business, Page: 2 The Guardian, Journal, Page: 3

HMRC benefits from film and TV tax breaks

The UK film and TV industry generated a record £7.9bn in 2016, helped by government tax reliefs. A BFI-commissioned report found that £632m in tax relief prompted additional spending of more than £3bn on the creation of films, high-end television and computer games.

BBC News Financial Times, Page: 3 The Daily Telegraph, Business, Page: 4


Accountants face ban on consultancy work

The Financial Reporting Council could ban accounting firms from providing consultancy work to firms whose books they check as part of a new “strategic plan” to ensure that audit serves the public interest better. As it releases its ‘Developments in Audit’ report, the FRC said it will explore “whether further actions are needed to prevent auditor independence being compromised, including whether all consulting work for bodies they audit should be banned.” Mike Suffield, the FRC’s acting audit head, said the sector was facing a growing challenge to maintain public trust. “The audit expectations gap feels like it’s wider than it’s ever been,” he said. The FRC’s report analysed the impacts of previous reviews by the EU and the now-defunct Competition Commission, which introduced mandatory rotation of auditors for listed firms. It found that although the change had produced significant reduction in overall audit tenures, it had failed to bring about diversification – actually resulting in even more audit contracts ending up with the Big Four.

Daily Mail City AM, Page: 3

Brexit anxiety increases among British businesses

Research by Deloitte shows British businesses are more anxious about Brexit than at any time since the 2016 referendum, with more bosses reining in hiring and investment plans. The firm’s latest survey of CFOs found that only 13% are more optimistic about the prospects for their company than they were three months ago, whereas in July, 24% expected conditions to brighten. Some 79% of finance chiefs say they now expect the long-term business environment to be worse as a result of leaving the EU, up from 75% in the second quarter of 2018. “CFOs have become more pessimistic about the long-term effect of the UK’s departure from the EU,” said Ian Stewart, chief economist at Deloitte.

The Guardian, Page: 31 The Daily Telegraph, Business, Page: 3


Ex-Tesco directors on trial

Two former directors at Tesco have gone on trial, accused of manipulating figures that resulted in the firm’s profits being overstated by £250m. Chris Bush, Tesco’s former UK managing director, and ex-UK food commercial director John Scouler are each charged with one count of fraud and false accounting. Former UK finance chief Carl Rogberg, charged with the same offences, is not well enough to stand trial. All three men deny the charges. In opening arguments at Southwark Crown Court, Sasha Wass, QC for the prosecution, described Mr Bush and Mr Scouler as “generals” and claimed that the “foot-soldiers” working below them were “pressurised and coerced” into wrongly including income into Tesco’s financial records to hit targets and make the supermarket look healthier than it was.

Financial Times, Page: 18 The Guardian, Page: 35 The Daily Telegraph, Business, Page; 3 The Times, Page: 39 City AM, Page: 3

Tchenguiz suing Grant Thornton

Lawyers for property tycoon Robert Tchenguiz have accused Grant Thornton of “spoon- feeding” a botched criminal investigation into him by the Serious Fraud Office. Mr Tchenguiz is suing the firm, claiming hundreds of millions of pounds in damages.

The Times Daily Mail, Page: 62 City AM, Page: 1, 5


CBI calls for business rate changes

The CBI has called on Philip Hammond to change rules covering business rates so that companies could immediately benefit from any drop in their property value. In a letter to the chancellor, the group also calls for more tax perks to encourage investment, further reform of the apprenticeship levy, plus funding for a one-stop shop for firms to get Brexit advice.

Daily Mirror, Page: 43 Financial Times, Page: 2

SMEs raise pay to attract workers

Most smaller firms are having to increase pay to attract suitably skilled staff, according to a study by Robert Half. Its survey of 600 chief finance or information officers in SMEs found problems recruiting workers with analysis and digital skills or softer skills such as critical thinking. More than two out of five firms have increased pay in the past three years to boost recruitment.

The I, Page: 40

Advice for enterprising businesses

Adrian Gregory, chief executive of Atos UK & Ireland, says SMEs and microbusinesses could benefit from an enterprise account, containing everything from how to register a business, bookkeeping services, tax liabilities to how to access specific funds as well as mentor and training schemes.

The Daily Telegraph, Business, Page: 2


Ministers mull tax break for landlords selling to tenants

The government is considering plans to give landlords tax breaks for selling property to long-term tenants. Ministers are looking at offering 100% relief from CGT when owners of buy-to-let homes sell to tenants who have lived there for at least three years. Meanwhile, figures from the Institute for Fiscal Studies reveal barriers to homeownership are now so high that even with a 10% deposit only 60% of people aged 25 to 34 could borrow enough money to buy the cheapest home in their area.

The Times, Page: 2 Daily Mail, Page: 29 The Sun, Page: 2

Overhaul property tax, says think tank

The Institute for Public Policy Research (IPPR) has proposed scrapping council tax and stamp duty in favour of a new 0.5% levy on the value of people’s homes.

Yorkshire Post, Page: 4


Insurers warn of rising pension costs post-Brexit

Insurance industry leaders have warned pension costs could increase significantly after Brexit if European countries change the rules on how much capital insurers must hold. It is feared that future changes to the Solvency II regime, which governs capital requirements, could leave UK insurers at a disadvantage, pushing up the cost of serving customers.

The Times


Economy ‘stuck in a rut’ warns BCC

The UK economy is “stuck in a rut” because of uncertainty over Brexit and weaker confidence, according to the British Chambers of Commerce. Its third quarter economic survey of 5,600 firms found that companies in the services sector, which represents 76% of UK GDP, had “given up” hiring staff. It said of those firms who did try to find new staff, 72% reported difficulties. It also said that the UK manufacturing industry had seen exports slow. However, BDO’s latest Business Trends Report suggests that “resilient” manufacturing growth is propping up business output, with September’s business growth slowly picking up despite “persisting political and economic uncertainty”.

The Times, Page: 37 Financial Times, Page: 2 The Scotsman, Page: 6, 37 City AM, Page: 13

London floats to the top

London Stock Exchange has been named the most attractive market for newly listed companies in Europe after hosting 16 IPOs in the third quarter of the year. The activity raised £1.7bn – 49% of the total across Europe – and included four of the five largest IPOs. Lucy Tarleton, a director at PwC, said: “With Brexit around the corner, it is promising to see a number of international issuers in the IPO pipeline continuing to see London as a key financial centre.” However, EY research shows that the volume of stockmarket flotations still fell by 47% in the third quarter, while the value of proceeds raised from London listings was also down by 71%.

Daily Mail, Page: 70 The Times, Page: 38-39

Bankruptcies rise after steel job losses

Three steel-producing areas hit by jobs cuts have topped a list of places where bankruptcy rates are soaring. The survey by UHY Hacker Young reveals Stockton-on-Tees, and Torfaen and Neath Port Talbot in South Wales all saw personal insolvencies rise by over a fifth.

The Sun, Page: 15 The I, Page: 40

IMF urges UK to lift public spending

The IMF has advised Philip Hammond to loosen the purse strings on public spending and taxation to cushion the expected economic fallout of a hard Brexit. The organisation said the reduction in the deficit – from a record £153bn in 2009-10 to £39.9bn last year – has given the chancellor space to ease austerity measures to boost the economy.

Financial Times, Page: 1 Daily Mail, Page: 62 City AM, Page: 2

Consumers’ faith in economy dips

Consumer faith in the British economy fell in the second quarter of 2018, to a level of -28.4, according to the ONS. The organisation’s index records a neutral feeling about the economy as zero. Consumers were more sanguine about the state of their own personal finances, but still recorded a negative sentiment of -1.2 in June. A separate survey by Barclaycard shows nearly two thirds of Britons still lack confidence in the UK economy ten years on from the financial crisis.

The Daily Telegraph The Sun, Page: 43

Retail growth down in September

Figures from the British Retail Consortium and KPMG show retail sales fell by 0.2% in September on a like-for-like basis compared with the same period last year.

The Times, Page: 40 The Independent, Page: 64 City AM, Page: 11


Pop star feeling blue over bankruptcy

Former pop star Lee Ryan [ex of British Boy Band “Blue”] has revealed that he lost his fortune after investing in a supposed tax avoidance scheme which ultimately landed him with a huge bill from HMRC.

The Sun Daily Star

Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Monday 8th October 2018

News Roundup Monday 8th October 2018



HMRC criticised for lack of no-deal preparedness

The Public Accounts Committee has criticised HMRC for failing to properly inform business about how to prepare for a no-deal Brexit. PAC chair Meg Hillier said officials have not yet identified 100,000 small traders who would be affected by a new customs regime after the UK leaves the EU, stating in a letter to Jon Thompson, permanent secretary of HMRC, that she was “concerned and disappointed” that firms had not been contacted. Hillier also expressed concern that Thompson had acknowledged that HMRC’s CDS system would be subjected to further delays, and that would mean it would have to run alongside the old CHIEF system, further increasing costs.

The Guardian, Page: 13 City AM, Page: 7

Focus on finance cost UK £4.5trn

A study from the Sheffield Political Economy Research Institute estimates that the UK lost out on £4.5trn in economic growth over the course of two decades because the financial services industry sucked investment and talent from other sectors. John Christensen, a director at the Tax Justice Network who helped develop the framework for the research, said to solve the problem the City’s “leaden grip on our economy” needs to be loosened by strengthening regulation and increasing taxes on the financial sector.

The Independent, Page: 40

Unilever decision forces Dutch government to review controversial tax break

Unilever has abandoned plans to scrap its dual-listed structure and move its headquarters to the Netherlands, following intense investor pressure to remain in the UK from shareholders. The FT reports that the decision has led the Dutch government to reconsider its promise to scrap its dividend tax – a move designed to attract foreign businesses to the country.

Financial Times The Daily Telegraph Financial Times, Page: 17 The Times, Page: 48

Dividend tax confusion

The Times’ Mark Atherton explains the rules around dividend tax following numerous reports that HMRC guidance has been substandard and risked many people not reporting income when they should have. The nub of the problem, Atherton says, is that HMRC failed to make the distinction between needing to submit a tax return if dividend income was above £10,000 and needing to notify the Revenue if it exceeds the tax-free allowance – £5,000 for 2017-18, falling to £2,000 for 2018-19.

The Times, Page: 60

Hammond told not to dampen winemakers’ spirits

Wine growers are urging the Chancellor to scrap plans to hike a planned 3.4% duty rise stating that it would reverse the good fortune brought by the hot summer. Miles Beale, from the Wine and Spirit Trade Association, said: “Adding to the already high tax bill is hampering the industry’s ability to grow.”

Daily Mirror, Page: 11 The Sun, Page: 18

Hammond drafting tax on digital ad revenue

The Chancellor is putting together a new digital tax on advertising revenues that would hit the likes of Google and Facebook hard but would cost Amazon relatively little. The Telegraph reports that the Treasury is attempting to identify how much value companies generate from UK users and trying to make sure tax is paid on that value. In 2017, Google and Facebook generated £4.4bn and nearly £2bn in UK advertising revenue. A Whitehall source suggests Amazon may be let off the hook when it comes to a digital tax over fears the costs would be passed on to consumers. Meanwhile, Tesco’s chief executive Dave Lewis has called for a 2% tax on goods sold online – dubbed an “Amazon tax” – to help lift Britain’s struggling store chains. It would make £1.25bn a year for the Treasury, he added. The Sunday Times’ Tommy Stubbington looks in detail at the options for a digital tax and the challenges facing the Chancellor, both domestically and internationally.

The Sunday Telegraph, Business, Page: 1 The Mail on Sunday, Page: 16, 87 The Sunday Times, Business, Page: 6

Facebook’s tax bill inches upwards

Revenues have leapt for Facebook in the UK from £842m in 2016 to £1.26bn for the year ending December 2017 while UK profits increased from £58.5m to £62m. The company’s corporate tax bill rose from £5.1m to £15.8m. It is also noted that Facebook received £8.4m in tax credits from employee share awards. The social media company’s head of Northern Europe Steve Hatch pointed out that Facebook “changed the way we report tax so that revenue from customers supported by our UK teams is recorded in the UK and any taxable profit is subject to UK corporation tax.” Elsewhere, the Sunday Times shows how McDonald’s uses franchise fees to limit its UK tax bill.

The Sunday Telegraph The Sunday Times, Business, Page: 3

Now ITV stars face IR35 crackdown

TV presenter Eamonn Homes is facing a tax bill of up to £2m after HMRC challenged his freelance status and use of a personal service company to receive his ITV salary. Holmes said: “I was in court in Central London for a week in June. I’ve been freelance for 28 years and that’s been okay. Now they’ve said it’s not okay.” He said he was the test case – “next they would be after everyone else.” The Mail on Sunday claims other ITV stars who are directors of their own limited companies include Ant and Dec, Phillip Schofield, Holly Willoughby and Lorraine Kelly. HMRC says that under rule ‘IR35’ most TV presenters will fall into the category of being employees. The paper also reports that BBC R4 Woman’s Hour presenter Dame Jenni Murray is heading for a tax tribunal showdown with HMRC over her use of a PSC which she wound up in 2014.

The Mail on Sunday, Page: 7

HMRC blunder robbing grieving families of tax-free benefits

HMRC is sending out demands to grieving relatives claiming tax is due on lump-sum death benefits when it is not. A computer foul-up relating to the P6 coding notice means that, since 2016, HMRC has been mistakenly issuing temporary tax codes based on the lump sums. The issue was reported to HMRC in May 2016 but still has not been resolved. Sir Steve Webb, director of policy at Royal London and a former pensions minister, said: “It is distressing enough to deal with bereavement without having the tax office take a chunk of your bereavement lump sum when it should have been tax free.”

The Sunday Times, Business, Page: 11

Applying tomorrow’s rules to yesterday’s tax bill

The Sunday Telegraph’s Sam Meadows considers how tax laws are being enforced retrospectively, ruining the lives of people who legitimately believed they were engaging in lawful practice. He focuses on contractors who used employee benefit trusts, which were widely used for much of the 2000s but declared effectively illegal by HMRC in 2010. People are being bankrupted for schemes they declared to the taxman almost 20 years ago and for which they received expert advice. Meadows says: “The Government hasn’t so much moved the goalposts as pulled them from the stadium and set them alight.”

The Sunday Telegraph, Business, Page: 5

BCC calls for Brexit tax break

The British Chambers of Commerce (BCC) has written to Phillip Hammond calling for a five-fold increase in the annual investment allowance in his Budget. Adam Marshall, director-general of the BCC, said hiking the allowance to £1m would create a “Brexit investment incentive” that would unleash an economic resurgence.

The Sunday Times, Business, Page: 2

Insurance tax hikes send patients back to NHS

Tax rises on private medical insurance have pushed 200,000 patients back to the NHS since 2015 at a cost to the taxpayer of £126m a year, according to a report commissioned by Bupa.

The Sunday Times, Business, Page: 15


Open-plan offices hinder focus-based work

A study by office design company Unispace has found open-plan offices are harming productivity because workers find it harder to concentrate. Professional services workers said their activities require them to focus for two thirds of their day, bankers said it was 60% and IT experts said 55%. All three professions said only about a quarter of the day was spent collaborating.

The Times, Page: 48


UK manufacturers pulling back on investment plans

A report from the EEF and Santander has warned that British manufacturers are pulling back on their investment plans due to mounting uncertainty about Brexit and fears of a global trade war. Only a third of companies said they planned to increase their investment in plant and machinery – a record low in the fifth annual survey. Smaller firms are particularly squeezed, with 75% saying they were having to mothball spending plans in the coming two years.

The Guardian, Page: 58

Santander campaigns for small business customers

Santander is making its 123 current account available for business customers as it moves to increase its slice of the small business banking market. The bank will offer small businesses an account costing £12.50 a month and will return cash, based on their turnover, of between 1% and 3%, with a maximum of £300 a year. The move comes as Santander gets ready to bid for a grant from the £775m RBS fund designed to increase competition and innovation in business banking.

The Times, Page: 44

Red tape and finance key barriers to SME growth

The Sunday Telegraph’s Matthew Caines reports on how red tape and difficulties with early-stage financing are holding back small business growth in the UK. The British Business Bank found many small firms are unsure about navigating today’s finance options and only one-in-four have someone sufficiently qualified in charge of finance. The FSB’s Mike Cherry says skills shortages are one of the biggest barriers to future growth while 18% of SME owners questioned by BVA BDRC’s Finance Monitor said bureaucracy and red tape was a “major obstacle” to their business.

The Sunday Telegraph, Business, Page: 5

Top Track 250 firms achieve record profits

Dave Munton from Grant Thornton explores in the Sunday Times the reasons behind the performance of the UK’s Top Track 250 companies, profits at which are up a record 27% to £6.4bn, on combined sales of £66.7bn, up 18%. Their success is attracting North American investors and corporate buyers in particular, the paper points out. Elsewhere in the Top Track 250 supplement, David Dunckley, head of Mid-Market at Grant Thornton, talks to leaders of eight firms about the opportunities they see for further growth.

The Sunday Times, Top Track 250, Page: 1, 3


McEwan: No-deal Brexit could result in recession

RBS chief executive Ross McEwan has warned a no-deal Brexit could tip the UK economy into recession. He said that a “bad Brexit” could result in “zero or negative” economic growth which would hit RBS’s share price. He also said the bank was becoming careful about lending to certain sectors of the economy – particularly retail and construction. Mr McEwan said: “We are assuming 1-1.5% growth for next year but if we get a bad Brexit then that could be zero or negative and that would affect our profitability and our share price.” He said that RBS’s lending to large businesses was down 2% this year as they delayed investment decisions. On a brighter note, Mr McEwan said that SMEs seemed relatively unaffected by Brexit and were continuing to borrow, invest and grow their businesses.

The Daily Telegraph City AM, Page: 7 BBC News The Guardian, Page: 36 The Scotsman, Page: 13

PM will need £20bn to end austerity

The Institute for Fiscal Studies has estimated that Theresa May’s pledge to end public sector cuts and fund pay rises will cost at least £20bn over the next five years. IFS director Paul Johnson told the BBC that the Chancellor would be concerned about adding to rising public sector debt and warned that, if Brexit resulted in a recession, more austerity could follow. A report from the think-tank also predicted that male manual workers are at “particular risk” from the new barriers to trade that are likely to be introduced after the UK leaves the EU.

The Independent, Page: 10, 13 The Sun, Page: 2, 8 Financial Times, Page: 3 The Times City AM, Page: 2

Productivity improves in Q2

Official figures from the ONS have revealed that UK productivity grew in the second quarter of the year but is still behind rates achieved before the global financial crisis in 2008. The ONS said output per hour was up 1.4% compared with the same period last year, it rose by 0.5% compared to the first quarter. Yael Selfin, chief economist at KPMG, said productivity would need to show further improvement for households to see a meaningful rise in purchasing power. Meanwhile, Howard Archer, chief economic advisor to the EY ITEM Club, said that while the rebound in productivity growth was encouraging, businesses would need to invest in themselves for productivity to improve.

BBC News The Times, Page: 50

Interest rates could reach 1% by February

Economists have suggested that interest rates could rise to 1% by February as strong economic data prompts the Bank of England to act before Brexit. Figures due out this week are expected to show the economy grew by 0.6% between June and August, up from 0.4% the previous three months. Amit Kara, chief UK forecaster at the NIESR think-tank, said he was confident growth would continue at least until the New Year. He said that would pave the way for a rate rise from 0.75% to 1%. Jay Mawji, managing director of Infinox, added that a rate rise before March was “probable” if Brexit negotiations went well. However, Yael Selfin, UK chief economist at KPMG, said she did not expect a rate rise for at least another year.

The Mail on Sunday, Page: 88


Hammond told to end pensions trap hurting poorest workers

Former pensions minister Baroness Altmann is supporting calls for a change in pensions rules that currently mean over a million low-paid workers are missing out on pensions tax relief. As many as 1.2m people earn between £10,000 and £11,850 per year, meaning although they are automatically enrolled in a pension by their employer, they are not entitled to 25% relief on pension contributions because they are below the income tax threshold. Altmann said: “This issue is a huge pensions injustice [and] has the potential to destroy confidence in auto-enrolment, which has so far been a huge success.” A slew of pension, tax and employment leaders have joined Altmann in signing a letter to the Chancellor demanding he end the scandal in this month’s Budget.

Sunday Express

Pension savers losing out on cash trade-in deals

Savers in their fifties are losing nearly 50% of the value of their “gold-plated” defined benefit pension funds when trading them in for cash lump sums, new research reveals.

Financial Times


UK’s Brexit divorce bill could rise, EU auditors warn

A report published on Thursday by the European Court of Auditors indicates that the EU’s pension liabilities have unexpectedly increased to €73.1bn in 2017, up from a previous estimate of €67.2bn, meaning that the UK’s generally-accepted figure of around £39bn could increase substantially. So-called “contingent liabilities”, guarantees on investment projects, have also increased – to €123bn in 2017 from €115.3bn the prior year.

The Independent Daily Mail, Page: 12

HSBC commissions finance fairy tales

HSBC has collaborated with children’s author Emma Dodd to publish a fairy tale designed to help children better understand finance. The book, called Fairer Tales: Princesses are doing it for themselves, tells of Cinderella starting a business, Sleeping Beauty having her savings grow while she sleeps, and Rapunzel chopping off her hair to make a ladder for herself rather than a prince before redeveloping the tower with a bank loan.

The Independent, Page: 43

HSBC commissions finance fairy tales

HSBC has collaborated with children’s author Emma Dodd to publish a fairy tale designed to help children better understand finance. The book, called Fairer Tales: Princesses are doing it for themselves, tells of Cinderella starting a business, Sleeping Beauty having her savings grow while she sleeps, and Rapunzel chopping off her hair to make a ladder for herself rather than a prince before redeveloping the tower with a bank loan.

The Independent, Page: 43

Fear of far-left loathing

Several papers consider the prospect of a Jeremy Corbyn-led Labour government coming to power following several recent reports that Britain’s wealthy are readying themselves to flee. The Mail on Sunday’s Jeff Prestridge talks to advisers about what people can do to minimise risk if they cannot afford to simply up sticks like Lord Sugar, who said he would leave the country if Mr Corbyn becomes the next PM. Writing in the Sunday Times, Luke Johnson, chairman of Risk Capital Partners, says it is entrepreneurs who are the real anarchists – they enter what are essentially chaotic market places and overthrow the existing order – “Socialists such as Jeremy Corbyn fail to see that more government, public spending, taxation and regulation is not the answer. These just crush individual initiatives, which taken together are what actually deliver progress.” Finally, the FT follows up on a previous re port into the topic and talks to one London small business owner, who tells the paper a

far-left Labour government “is a f**king terrifying possibility.”

The Mail on Sunday, Page: 94 The Sunday Times, Business, Page: 9 Financial Times


Viral publisher to enter administration

Bentley Harrington, the firm behind internet news site Unilad, is set to go into administration, placing hundreds of jobs at risk. Unilad co-founder Alex Partridge is owed £5m by Bentley Harrington, which also owes HMRC £1.5m.

City AM The Sun, Page: 49


Council wants to take over empty Kensington and Chelsea homes

The Royal Borough of Kensington and Chelsea is lobbying ministers to change the law so the council can move social housing tenants in empty private homes. Current rules on Empty Dwelling Management Orders only permit local authorities to take over temporarily empty and vandalised properties, but the council wants the law relaxed so any homes that have been vacant for two years can be taken over. Kim Taylor-Smith, the council’s deputy leader, said owners could be offered “a favourable taxation scheme on the income provided to them from tenants” as an incentive to offer their homes voluntarily.

The Daily Telegraph

HMRC too slow rectifying overpayments

Leicestershire-based Cornerstone Tax says an over-complicated stamp duty system is leaving people waiting months to get refunds on overpaid duty. Properties deemed as “mixed use” should attract a tax discount, but solicitors are often using HMRC’s basic online calculator to advise buyers and this fails to give adequate guidance. David Hannah, the founder of Cornerstone, says the average response rate from HMRC is at about three months but some have waited nearly a year for a refund.

The Times, Page: 60

House price growth slump in September

UK house prices saw their biggest fall in five months in September, while price increases compared to the same period in 2017 slowed to a three-month low. Latest figures from Halifax show house price inflation dropped to a 2.5% rise in the year to the end of September from 3.7% in August, with the average home costing £225,995, down from £229,284 last month – a month-on-month drop of 1.4%.

BBC News City AM Financial Times, Page: 3 The Daily Telegraph, Business, Page: 35 The Times, Page: 50

Government considers “big offer” to Generation Rent

Downing Street and Treasury officials are studying a plan to scrap CGT for landlords if they sell their properties to tenants who have lived in them for three years or more.

The Sunday Times, Page: 2


Ultra-rich shift assets as fear of Labour mounts

The FT reports on how the UK’s super rich are moving assets out of the UK in fear of a Corbyn-led Labour government. Grant Thornton is among those with clients seeking advice on the threat.

Financial Times, Page: 2

Rich getting ready for a quick getaway if Corbyn wins

Growing fears over a Corbyn-led Labour government are leading wealthy Britons to sell up and rent so they can quickly shift their capital abroad, the Times reports. Glentree Estates said their letting market had “gone berserk” while wealth management partner at Baker McKenzie, Ashley Crossley, said “wealthy people are […] are starting to ask whether the UK is the right place for them if Corbyn wins.” Gareth Parsons, financial planning director at wealth manager Saunderson House noted that concerns were not all about tax increases – “it’s more a fear of Labour policies damaging the economy more widely and having a detrimental effect on asset values.” Following reports in the FT yesterday that the ultra-wealthy were preparing to move assets abroad, John McDonnell, the shadow chancellor, warned: “Society will not tolerate the rich refusing to shoulder their fair share of resp onsibilities. We will take all the necessary action to make sure they do.”

The Times, Page: 4 Financial Times Daily Mail, Page: 10 The Sun, Page: 2

Contact Paul Southward if you have any queries.

Paul Southward

News Roundup Friday 5th October 2018

News Roundup Friday 5th October 2018



FTSE 100 companies failing to address tax evasion

A survey from Pinsent Masons has found that 55% of FTSE 100 companies do not include their strategy to combat tax evasion in their tax strategy documents, annual reports, environment social and governance policies or other related documents. Additionally, 33% of the financial services businesses in the index failed to mention tax evasion at all. Jason Collins, partner at the law firm said: “FTSE 100 firms failing to publicly address tax evasion could raise questions for stakeholders over their management of reputational and financial risks”, adding: “With the potential for unlimited fines it’s not surprising that shareholders and other stakeholders will want reassurance that big businesses have got the risks of tax evasion under control”.


Airbnb’s tax bill revealed as Hammond calls for tech tax

Airbnb paid almost £600,00 0 in tax in the UK last year, according to accounts seen by City AM. This is on an operating pre-tax profit of £1.8m for the UK office, which provides marketing services. The 2017 tax bill is over three times the sum paid in 2016 – £188,000. The paper’s Emily Nicole points out that the majority of Airbnb’s business profits in the UK are channelled through its Ireland headquarters, much like other tech firms such as Amazon, Facebook and Google. The accounts are due to be published later this week and follow a call from the Chancellor for a digital services tax for large tech firms, a move industry sources say will hurt investment in British companies. Meanwhile, in a letter to the FT, the ACCA’s Chas Roy-Chowdhury warns the Chancellor against going it alone with a digital services tax, because, as Germany realises, it will open the country up to retaliation.

City AM Financial Times, Page: 12

Heterosexual couples allowed civil partnerships

The government has announced that straight couples are to be allowed to enter into civil partnerships – ending the anomaly whereby same-sex couples can choose between getting married or a civil partnership, while opposite-sex couples are limited to marriage only. The move should bring equal tax, inheritance and pensions rights to mixed sex couples. Some Conservative MPs have demanded the change also extends the right to relatives who have lived together for more than 12 years so they avoid being crippled by inheritance tax.

Financial Times, Page: 2 Evening Standard The Independent, Page: 7 The Sun, Page: 4 Daily Mail, Page: 10 The Times, Page: 8-9 The Guardian, Page: 5

Chuck Chequers and return to Tory values – Johnson

Boris Johnson has slammed Theresa May’s Brexit plans as “politically humiliating” and an “outrage” that would leave the UK “locked in the tractor beam of Brussels”. In a speech to over 1,400 activists at the Conservative Party conference he urged delegates to pressure the PM to “chuck Chequers” and return to the vision she set out in her Lancaster House speech. Mr Johnson also championed the free market and low taxes, calling for a return to “basic Conservative ideas and values”.

The Daily Telegraph The Times Financial Times, Page: 3 The Guardian Daily Express, Page: 5

Amazon raises minimum wage in UK and US

Amazon has raised its minimum wage for workers in the UK and the US following criticism that its staffing was being subsidised by state welfare while politicians on both sides of the Atlantic have accused the company of paying too little tax. In the UK 40,000 permanent and temporary staff will get an increase to £10.50 an hour in London and £9.50 across the rest of the country – a rise of up to 28%.

The Daily Telegraph, Business, Page: 1 The Times, Page: 37 The Guardian, Page: 4, 35 Financial Times, Page: 1 Daily Mail, Page: 57 The Sun, Page: 43 The Independent, Page: 63 Daily Mirror, Page: 7 I, Page: 4 Yorkshire Post, Page: 9 The Scotsman, Page: 4

EU agrees to cut VAT on digital publications

The Government has been urged to scrap VAT on e-books after EU finance ministers agreed to allow member states to apply for reduced or zero-VAT rates for electronic publications. In the UK, readers of online newspapers, e-books, journals and magazines pay a 20% sales tax, while their print equivalents are zero-rated for VAT.

The Daily Telegraph, Business, Page: 7 The Times, Page: 2

Tribunal rules that CGT applies to non-existent flat

HM Revenue and Customs has won an appeal to charge £61,383 in capital gains tax on a property that had not been built – a decision described by Kingston Smith’s head of tax, Tim Stovold, as coming from the “world of Alice Through The Looking Glass”. The Upper Tribunal decided HMRC was right to apply the tax to Desmond Higgins, who paid a reservation deposit on an off-plan property in 2004 which was not finished until 2010. He sold the property in 2012 and was assessed by HMRC as owing capital gains tax of £61,383 for the tax year 2011-2012 – assessed including the period leading up to 2010, when the property had not yet been built. Higgins appealed to the First Tier Tribunal, arguing that the period of his ownership was coterminous with the period when the apartment was his main residence so that he was entitled to main residence relief on the whole of the capital gain accruing to him on the dispos al on 2012.

FT Adviser Economia

Future income tax rise for Wales ‘not ruled out’

Mark Drakeford, Wales’ finance secretary and frontrunner to be the next First Minister of Wales, has left the door open to raising income tax before the next assembly election in 2021. No changes to income tax were presented in Mr Drakeford’s £18bn draft budget for next year, announced on Tuesday; he said: “I will not move away from our manifesto commitment [to leave tax rates unchanged] unless I’m compelled to do so, but I don’t rule out the possibility that circumstances could change in a way that do have that compelling impact.”

BBC News

Taxpayers facing dividend penalties

Hundreds of thousands of taxpayers could end up being penalised for failing to report their dividend incomes for the past financial year because HMRC failed to update its advice about who needs to fill in a tax return. New rules mean basic-rate taxpayers who receive dividends of more than £5,000 are liable to pay the 7.5% dividend tax themselves. Until the tax year 2016-17, dividends were paid after deduction of basic-rate tax at source. HMRC said there was “discretion” over penalties and “we don’t rush to enforce them”. The deadline is tomorrow and failure to reveal unreported income could result in penalties of 100% of any tax due.

The Times, Page: 2


Government pledges to pay 90% of SMEs within 5 days

The Government has pledged to pay 90% of their SME suppliers within 5 days when invoices are uncontested, an improvement on the current target of 80% in five days and 30 days for the remainder. Business minister Kelly Tolhurst also said the Government will consult on how to improve payment times in the private sector, including looking at using new accounting technology and requiring companies to nominate a director responsible for fair payment practices. Mike Cherry, the chairman of the Federation of Small Businesses, welcomed the announcement and called for a “new tough and transparent compliance regime” to be imposed. However, writing in City AM, Greg Carter the CEO of Growth Street, says a robust and enforceable payment code is needed and SMEs should be persuaded to use trade credit insurance – “insurers can give SMEs valuable information about the likelihood of big corporates paying on time or at all.”

The Daily Telegraph, Business, Page: 1 Daily Mirror, Page: 45 City AM, Page: 27 Yorkshire Post, Page: 4


Lenders attempt to galvanise B2L market as tax changes bite

Lenders are improving their offer to buy-to-let landlords after changes to the tax rules cut demand for borrowing. Landlords were being discouraged by the stamp duty surcharge on second homes and were slowly losing the ability to offset mortgage interest against profits, experts said.

The Daily Telegraph

London developers hit by new stamp duty tax on overseas buyers

Shares in developers reliant on overseas investors to fund new luxury apartment blocks in London fell yesterday after the government announced plans to tax foreign buyers of UK property.

Financial Times


DB pension deficits fell in September

The most recent figures from PwC’s Skyval Index show the deficit of defined benefit (DB) pension funds in the UK fell from £170bn at the end of August to £150bn at the end of September 2018. PwC’s chief actuary, Steven Dicker, said the change was “predominantly due to increases in gilt yields impacting liabilities more than assets.”

FT Adviser



The Gym Group has appointed former Tesco director Mark George as its chief financial officer. Most recently, Mr George was CFO at Auto Trader. Elsewhere, STV Group has revealed that CFO George Watt is to leave the company in the spring after two decades of service.

City AM The Times, Page: 42 The Scotsman, Page: 34


UK businesses dismissive of immigration plans

Businesses across the UK have strongly rejected the government’s latest proposals to cut “low-skilled” immigration after Brexit, arguing that the changes would mean price hikes leading to lower standards of living. The reaction came after Sajid Javid confirmed that EU and non-EU migrants will be treated the same after Brexit. In response, Mr Javid told firms to wean themselves off cheap foreign labour.

The Independent Daily Mail, Page: 8-9 The Daily Telegraph, Business, Page: 2

UK services sector activity slowed in September

UK service sector growth slowed in September, according to IHS Markit’s latest purchasing managers’ index, down to 53.9 from 54.3 in August. Firms reported Brexit concerns and increased input costs.

Financial Times The Times, Page: 40 The Scotsman, Page: 35

Half of Yorkshire stores vulnerable to insolvency

The ratio of Yorkshire stores at risk of insolvency has risen from 30.2% to 44.3% in the last nine months, according to trade body R3, which adds up to over 4,400 shops. In the region, the breakdown of different types of shops reveals that home furnishings stores face the toughest challenges, followed by shoe shops and clothes stores.

Yorkshire Post


Trump denies tax dodging

Donald Trump has denied he engaged in tax avoidance and fraud after a New York Times investigation claimed he and his siblings owed over $500m in tax on their parent’s $1bn fortune but paid only $50m by undervaluing holdings and setting up “a sham corporation” to help disguise millions of dollars in gifts. Charles Harder, Trump’s lawyer, said: “There was no fraud or tax evasion by anyone. The facts upon which The [New York] Times bases its false allegations are extremely inaccurate.”

Daily Express, Page: 2 Daily Mirror, Page: 15

Government must help councils through austerity

Writing to the Independent, Paul Dossett, head of local government at Grant Thornton, asserts that the government’s 2019 spending review must provide a “genuine long term funding solution” for local authorities to help them navigate austerity. Local government needs emergency funding to see it through the next five-years, he urges, just like the NHS has received, which could be funded through specific grants, council tax increases or business rate retention decisions.

The Independent, Page: 39

Lord Sugar: No £50m cheques for Corbyn

Lord Sugar has vowed to quit Britain if Jeremy Corbyn comes to power. The businessman told the Sun: “If he’s in, I’m out. I won’t be writing £50m tax cheques any more. I’m gone. I don’t know where but I won’t be here.”

The Sun, Page: 19

NCA wins test case for new anti-corruption powers

The National Crime Agency (NCA) has won a case against a banker’s wife who must now respond to an Unexplained Wealth Order requiring her to explain how she could afford two UK properties worth £22m. Her lawyer argued that her husband, who is in jail for large-scale fraud and embezzlement offences relating to a partially state-owned bank he was chairman of, was not a “politically exposed person” but simply a “fat cat” banker and that the UWO was “disproportionate”. But Mr Justice Supperstone disagreed but allowed the details of the case to remain undisclosed to the public pending the outcome of an application for permission to appeal.

Financial Times Daily Mail The Guardian, Page: 21

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Paul Southward