Category Archives: Taxation

News Roundup Wednesday 28th November 2018


News Roundup Wednesday 28th November 2018

NEWS ROUNDUP

TAX NEWS

ADVISORY FUEL RATES FROM 1st DECEMBER 2019

Check out the latest figures in our publication here:-

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

INDUSTRY NEWS

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

REPORTING NEWS

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

SMEs NEWS

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

ECONOMY NEWS

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

OTHER NEWS

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


Business Update Winter 2018


Business Update Winter 2018

BUSINESS UPDATE

The latest edition of our Business Update series is now available

Unsettled weather ahead!

The weather this year continues on its topsy-turvy course very much like the current economic climate with all the political shenanigans and continued uncertainty over Brexit.

Making Tax Digital

Given the wide-ranging potential consequences of the negotiations with the EU, it is perhaps understandable that HMRC has just announced a new delay in the timetable for Making Tax Digital (MTD).

New horizons

As announced on 16 October 2018, the filing deadline for MTD for VAT has been moved to October 2019 for certain specialist and complex businesses. The April 2019 deadline is still in place for some VAT-registered businesses to submit their first reports using the digital system. At the same time, HMRC opened up the VAT pilot scheme for most businesses.

Unsettled front ahead!

With the Brexit deadline set for 29 March – and the possibility of a no deal departure still in the mix – this could mean that businesses are making their first filings at the same time as the VAT rules affecting customers and suppliers change. With such a potent mix of change, it is perhaps understandable that HMRC are taking some more time to prepare for the more difficult cases.

Business Update Highlights

The feature story in the new Winter 2018 edition of our newsletter, Making Tax Digital starts to take shape, looks at the new system, which will apply to all businesses whether they face the April or October deadlines. The sensible thing is to prepare your systems now. Being ready for MTD for VAT will leave you free to deal with whatever next year brings, when it brings it.

Other articles:

Other stories we cover include:

  • Closing loopholes around write-offs of director loans – If you are writing off a director’s loan, make sure you don’t incur unnecessary tax.
  • Intestacy and business continuity – We all know it is very important to make a will, but do you know what will happen to your business if you don’t?
  • Government cracks down on phoenixing – After some high-profile collapses, directors will have new responsibilities to failing companies.
  • Transforming remuneration in disguise – HMRC is bringing new controls to crack down on disguised remuneration schemes.

DOWNLOAD

You can download the latest edition of Business Update here:-

Business Update Winter 2018

We will bring you another update in a few months. Please do get in touch with Paul Southward or your usual KSK contact if you think you may be affected by any of the topics raised.

Paul Southward


News Roundup Wednesday 19th September 2018


News Roundup Wednesday 19th September 2018

NEWS ROUNDUP

TAX NEWS

Lib Dems want wealth tax to create £100bn ‘citizen’s fund’

Liberal Democrat leader Sir Vince Cable has proposed the creation of a sovereign wealth fund built from taxing the richest and the sale of assets. The £100bn “citizens fund” would then be used to spread the UK’s wealth more evenly, Sir Vince said. Explaining the policy on the BBC’s Andrew Marr Show, he said he wanted to scrap inheritance tax and replace it with “a tax on people’s gifts through their lifetime”. Every gift worth £3,000 or more above a lifetime tax-free allowance of £250,000 would be taxed at the recipient’s income tax rate.

BBC News The Sun, Page: 8 City AM, Page: 5

Revenues from climate change tax rocket

A new study by UHY Hacker Young shows that businesses have been hit with £1.9bn in tax just from the climate change levy in the last year, up from £690m in 2007-8. Partner Clive Gawthorpe said: “Although fighting climate change is a very worthy cause, these are some eyewatering rises in tax revenue. Most businesses would like to see more carrot and less stick – tax incentives and not extra taxes.”

The Scotsman, Page: 34

REPORTING NEWS

Top companies failing to report fully on diversity strategies

Research by the University of Exeter Business School shows only 15 companies in the FTSE 100 reported properly on their diversity policies and initiatives to shareholders. The Financial Reporting Council, which commissioned the study, said it would be writing to the UK’s largest companies urging them to report more thoroughly on their efforts to introduce more diversity to the boardroom. The Times says the move is part of the wider drive to get more women and ethnic minorities into senior jobs.

The Times, Page: 40

Financial sector remains an impenetrable black box

Despite being 10 years on from the financial crisis, the FT’s Jonathan Ford says the financial statements of banks continue to be opaque, leaving investors in the dark.

Financial Times, Page: 16

INDUSTRY NEWS

UK businesses suffer 123% rise in mandate fraud

Losses from mandate frauds have more than doubled to £77m in the past year, according to figures obtained by RSM. Businesses reported more than 3,451 incidents of mandate fraud in 2017-18 – up 123% on the previous year’s 1,551. RSM partner Akhlaq Ahmed said: “Businesses must ensure their accounts staff are trained to recognise the hallmarks of a mandate fraud attempt. With the right training and controls in place, there’s no reason why these frauds should be successful.”

City AM, Page: 17

Appointing auditors by public body is just a start

A letter in the FT backs the idea of a public body appointing auditors but suggests a change of auditor is vetted too “to ensure it is not a punishment for insisting on transparency.”

Financial Times, Page: 10

SMEs NEWS

Stride assures small firms as HMRC advises on no-deal Brexit

British companies trading with the EU will today receive a letter from the HMRC advising them on how to deal with the complexities of a no-deal Brexit. Small businesses could find themselves having to apply new customs, excise and VAT procedures to their goods and having to fill out customs declarations for the first time, the Times reports. The paper talks to Mel Stride, the financial secretary to the Treasury, about how hard it will be for businesses to navigate a no-deal Brexit. He insists there’s no need to panic: “I am confident that while we won’t on day one of a no-deal scenario have everything up and running as we would want to … we will have free-flowing goods coming into the country.”

The Times, Page: 44

New CBI leader seeks to be ‘more effective’ at taking on government

In a wide-ranging interview with the FT, John Allan suggests the CBI and other business organisations should receive funding to provide more support to small businesses preparing for Brexit.

Financial Times, Page: 10

PERSONAL FINANCE NEWS

Hancock considers auto-enrolment care fund

Ministers are considering a new type of insurance fund to pay for elderly care. Health Secretary Matt Hancock told the Telegraph that the proposals being considered are modelled on the “auto-enrolment” system of pensions. He said: “If you make it the norm, tell people what it is they have to do to look after themselves, it’s often the case that very few people will opt out.”

The Daily Telegraph, Page: 1, 7

ECONOMY NEWS

BCC warns of “snail’s pace” growth

The British Chambers of Commerce has warned that GDP growth will slow to “a snail’s pace” this year due to uncertainty over Britain’s future relationship with the EU. The business trade body cut its outlook to 1.1% from 1.3% and lowered its sights for 2019 from 1.4% to 1.3% in its latest quarterly update. The downgrades are driven by a weaker outlook for trade and investment. Exporters face more subdued growth over continued Brexit uncertainty and slower growth in key markets, the BCC says, while the high upfront cost of doing business in the UK and the ongoing uncertainty over the UK’s future relationship with the EU are expected to continue to stifle business investment.

The Times, Page: 37 City AM, Page: 7 The Scotsman, Page: 37

OTHER NEWS

KBW predicts 31% chance of Corbyn taking power this year

City analysts say the chances of the Tory government collapsing following a failure to reach agreement on Brexit, leading to a snap general election and a Jeremy Corbyn victory, have increased. Analysts at Keefe, Bruyette & Woods say there is now a 31% chance of Labour coming to power this year while it was “highly improbable” the Conservatives would maintain a majority in another election. They calculate a 6% chance for a no deal Brexit. KBW recommends buying stock in Asia-focussed banks HSBC and Standard Chartered and ditching some challenger banks such as OneSavings Bank and Charter Court.

The Daily Telegraph, Business, Page: 1

Contact Paul Southward if you have any queries.

Paul Southward


News Roundup Friday 14th September 2018


News Roundup Friday 14th September 2018

NEWS ROUNDUP

TAX NEWS

HMRC will use social media to pinpoint tax evaders

HMRC has said it will “observe, monitor, record and retain internet data”, including blogs and social networking sites, to detect tax evasion. The guidance on criminal investigations for tax offences also mentions other ‘open source’ internet sources which HMRC will monitor such as news reports, internet sites, Companies House and land registry records. “The guidance confirms what we already know – that HMRC plugs huge amounts of data into its state of the art ‘Connect’ computer system to identify those who may not be paying the tax they should,” said Steven Porter a tax disputes expert at Pinsent Masons.

International Adviser

Self-employed fearing tax rises

The Times’ James Hurley says last week’s cancellation of a long-promised tax relief for the self-employed has caused unrest amongst those who work for themselves. Andy Chamberlain, deputy director of policy at the Association of Independent Professionals and the Self-Employed, comments: “There’s a feeling that the government does not want people to strike out on their own, which is somewhat counter-intuitive for [a Tory administration].” Craig Beaumont, director of external affairs at the Federation of Small Businesses, adds: “There’s this sense that since a lot of money needs to be raised, small businesses and the self-employed are a soft target.”

The Times, Page: 49

Boris’s tax cuts plea rejected

The government has brushed off demands from Boris Johnson for sweeping tax cuts to boost Britain’s economy. A spokesman for the Prime Minister commented “I can point to this Government’s record of cutting taxes for hard-working households.”

Daily Express, Page: 5

Oil tax breaks could be scrapped

The oil industry has urged the Treasury not to raise North Sea taxes, despite the resurgence in prices. Ministers are said to be considering reversing some of the significant tax breaks introduced in 2015, when oil prices crashed.

The Times, Page: 44

HMRC fraud team collects £5bn in extra tax

HMRC’s Fraud Investigation Service (FIS) has collected £5.47bn in 2018, according to Pinsent Masons. The figure represents a 7% increase on last year and follows political pressure to increase the number of successful tax prosecutions in both the UK and abroad. In July of this year, HMRC published a consultation document, focusing on changes that could simplify the process of accessing taxpayer information through third parties, such as accountants, retailers, and social media platforms. The report suggested that the removal of having to go through a tribunal before securing this third-party information would help with increasing the efficiency of the process.

Accountancy Age

Labour budgeting for 15 years in power

Labour’s John McDonnell has said the party is preparing for a 15-year stretch in government, with plans to spend £500bn in the first 10 years. The shadow chancellor said Labour’s spending commitments would be funded by increasing taxes on the top 5% of earners, rises in corporation tax, a tax on financial transactions in the City of London and tackling “industrial scale” tax avoidance and evasion. He also claimed the measures were backed by the CBI, although the lobby group has distanced itself from Mr McDonnell’s comments.

The Times The Daily Telegraph, Page: 8-9 Financial Times, Page: 3 Daily Mail, Page: 12 City AM, Page: 4

Boris tax cut promise is ‘sheer folly’

The Times’ Daniel Finkelstein pours scorn on Boris Johnson’s suggestion of sweeping tax cuts to boost the economy. He says the idea that tax cuts pay for themselves is “seductive, but false” and that the Conservative Party needs to offer more to voters.

The Times, Page: 29

Thinktank proposes asset tax for over-65s

The Social Market Foundation has said homeowners and people with substantial savings should face a one-off “asset tax” of £30,000 when they reach 65 to fund England’s care system for the elderly. The thinktank estimates such a charge would raise £7bn a year and enable care in residential settings and in people’s homes to be delivered free, rather than based on a means test as now. It argued that it was not fair to force people of working age to pay more tax to fund care for older people. The Social Market Foundation said that the charge of £30,000 should be levied on anyone with assets worth more than £150,000 and paid when they turned 65 or deferred until their death.

The Times, Page: 2

Archbishop of Canterbury attacks tax-avoiding Amazon

The Archbishop of Canterbury has attacked Amazon over its tax affairs, accusing the internet giant of denying funds to health, education and defence. Justin Welby won a standing ovation at the TUC conference for rounding on companies that were “paying almost nothing in tax” and “leached off the taxpayer”.

Sky News Daily Mirror, Page: 1 The Times, Page: 1 Daily Mail, Page: 8 The Daily Telegraph, Page: 1

Lower taxes must be part of the mix

In a letter to the Times, Tom Clougherty, head of tax at the Centre for Policy Studies, says sustainably lower taxes on work, investment and profit must be part of Britain’s growth agenda.

The Times, Page: 32

SMEs NEWS

Concerns for small firms after railway arches sale

Network Rail has agreed to the £1.5bn sale of over 5,000 railway arches that are home to shops and small businesses around the country. It said the proceeds of the sale to Blackstone Group and Telereal Trillium would help fund railway upgrades. However, the Labour party has called for the deal to be halted, saying that the “highly irresponsible” transaction risked damaging thousands of SMEs. Campaign group Guardians of the Arches also warned the sale would lead to higher rents for tenants.

The Daily Telegraph, Business, Page: 1 Financial Times, Page: 1 The Times, Page: 19 The Guardian, Page: 7 The Sun, Page: 4 Daily Mail, Page: 63 Daily Express, Page: 7 City AM, Page: 1

Funding for Brightpay

HG Capital Trust has made a £15.4m investment in Brightpay, the technology company that develops accountancy and payroll software for SMEs in Ireland and the UK.

The Times, Page: 52

Battered by business rates

The Mail steps up its campaign for an overhaul of business rates by focussing on the impact that the levy has had on the Devon town of Sidmouth. According to research compiled for PwC, an average of 16 High Street stores across the UK closed every day in 2017, meaning an estimated 8,400 shops have closed since the rates were revalued last April. According to the PwC data, there were substantially more closures in the second half of last year after changes to business rates led to higher bills for more than half a million shops, restaurants and pubs.

Daily Mail, Page: 36, 41

FCA closes book on mis-selling scandal

The Financial Conduct Authority has said banks will face no further action over interest rate swap mis-selling. The improper sale of complicated interest rate derivatives led to the collapse of many small businesses and ranks as the second most expensive banking scandal behind payment protection insurance.

The Times, Page: 44

Labour warned against RBS lending plans

A former Permanent Secretary to the Treasury has warned Labour against using the taxpayer’s stake in Royal Bank of Scotland to direct lending to the British economy. Sir Nicholas Macpherson said Labour’s policy suggestion that RBS would be ordered to lend to small businesses using government funds would be “corrosive” for banks and taxpayers.

The Guardian, Page: 41

CORPORATE NEWS

Finance firms could gain from VAT loophole

Philip Hammond is facing a multibillion-pound hole in his budget projections as City businesses use Brexit to reduce their tax bills. Treasury officials have warned that unless there is a change to the law after Britain leaves the EU, the government could lose £7bn in corporate VAT receipts. It is feared that after Brexit firms could take advantage of a loophole allowing financial services businesses to claim back domestic VAT for the services they provide to individuals and companies outside the EU.

The Times, Page: 9

Union calls for Carillion criminal investigation

The Unite union has called for a criminal investigation into the collapse of Carillion, claiming that the probe being launched by the Insolvency Service was “too little too late”.

Daily Mirror, Page: 43

Publisher faces insolvency proceedings

The viral publisher Unilad faces insolvency proceedings in the High Court next week after HMRC issued a winding-up petition against its parent company.

The Guardian, Page: 19 The Business Desk

PENSIONS NEWS

Government urges pension schemes to be ‘socially responsible’

New government regulations will require trustees of pension schemes to disclose where people’s savings are going. Using internet dashboard-type tools, pension scheme members will be able to see whether investments take into mind environmental concerns, are managed with poor corporate governance or socially harmful practices.

City AM

PERSONAL FINANCE NEWS

Bonuses for low-wage workers who save

HMRC has launched a new savings scheme which could benefit up to 4m people on low incomes. Investors will receive 50p from the Government for every £1 they pay in to the Help to Save scheme. Up to £50 a month can be paid in over four years, with a maximum saving of £2,400 resulting in an overall bonus of £1,200.

Daily Mail, Page: 4 Yorkshire Post, Page: 6

Divorcing spouses unaware of pension entitlements

A charity has argued that women going through a divorce should be given the right to see the size of their husband’s pension pot. Age UK says thousands of women are being left worse off in retirement because they are not made aware of their legal entitlement to their husband’s private pension as part of the divorce process.

The Daily Telegraph, Page: 1 Daily Mirror, Page: 26

ECONOMY NEWS

Busy accountants help lift economy, ONS says

The UK economy grew by 0.3% in July, and by 0.6% over the three months to July, according to the ONS, the fastest pace in almost a year. “The dominant service sector again led economic growth in the month of July with engineers, accountants and lawyers all enjoying a busy period, backed up by growth in construction, which hit another record high level,” said Rob Kent-Smith from the ONS. John Hawksworth, chief economist at PwC, said the latest data justified the decision to raise rates last month, while Yael Selfin, chief economist at KPMG UK, added: “Uncertainties a nd risks around Brexit are likely to make the Bank of England particularly cautious during the critical months ahead”.

BBC News The Daily Telegraph, Business, Page: 3 The Guardian, Page: 28 Financial Times, Page: 2 The Times, Page: 41 City AM, Page: 3

Wages growth hits three-year high

ONS data shows wages, excluding bonuses, rose at their fastest pace for three years during the three months to July. The 2.9% increase was only the second time since July 2015 that the level has been reached, and earnings have now outstripped inflation for four months.

Financial Times The Daily Telegraph The Times, Page: 1-2 The Guardian, Page: 25 The Independent, Page: 62

Wages yet to reach pre-crash levels

Annual wages have failed to recover since the financial crash, according to the Institute for Fiscal Studies. The institute’s analysis shows median annual earnings were £23,327 last year, 3.2% lower than in 2008 when the average wage was £24,088. People in their 20s and 30s have been hit hardest. People in their thirties are the worst hit in terms of pay, with median earnings 7% lower than in 2008, while pay for those in their twenties is 5% lower.

The Guardian, Page: 41 The Independent, Page: 61 The Sun, Page: 22

INTERNATIONAL NEWS

Bain sets aside fees from South Africa tax authority work

US consultancy Bain will set aside more than $10m in fees from South Africa’s tax authority after evidence that its advice on a restructuring was used to pursue a political vendetta.

Financial Times, Page: 16 The Independent, Page: 62

Global tax agencies have largest US companies in their sights

A report by Baker McKenzie estimates that global tax authorities are currently scrutinising an estimated $75bn of capital held by the largest US companies.

Financial Times, Page: 14

ING CFO quits after laundering scandal

Koos Timmermans, the CFO of Dutch bank ING, has resigned following a money laundering scandal that led to a huge fine for the bank.

The Independent, Page: 54

OTHER NEWS

Tax break for exotic dancer

An exotic dancer has won a tax appeal over her skimpy stage outfits. Gemma Daniels, who worked at Stringfellows in London, was told to pay £10,500 by HMRC after it ruled that she could not claim for travel and clothing as tax-deductible. However, a judge decided that her ‘naughty nurse and schoolgirl’ outfits could be deemed expenses as they were not suitable outside of work.

Metro Daily Mirror, Page: 17 The I, Page: 11

Hammond delays budget date

Philip Hammond has postponed naming a date for the autumn budget. The chancellor wants to avoid the budget clashing with the final stage of the Brexit negotiations and has put the Office for Budget Responsibility on standby.

The Times, Page: 9

Treasury needs more accountants

The Institute for Government has criticised the Treasury’s model of hiring generalists, arguing that it needs “more of the people managing public spending to be qualified in finance, accountancy or both.” The IFG also claimed Treasury officials are “too young and inexperienced” to make good decisions about where best to spend taxpayers’ money. The average age of a Treasury official is 31 and one in four leaves the department every year, it noted.

The Times, Page: 43

ACCA welcomes city mayors

ACCA chief executive Helen Brand says the election of the UK’s six city mayors could not have come at a more important time, allowing for a more high profile, bigger-picture approach to regional issues.

City AM, Page: 15

Contact Paul Southward if you have any queries.

Paul Southward


News Roundup Friday 7th September 2018


News Roundup Friday 7th September 2018

NEWS ROUNDUP

TAX NEWS

IPPR wants tax reform to combat wealth inequality

The Archbishop of Canterbury has called for an increase in the minimum wage and an overhaul of the tax system to help close a widening gap between the rich and the poor. Justin Welby’s demands come in a report from the IPPR Commission on Economic Justice, which was co-written by the Archbishop and sets out a 10-year plan to get the economy working better for everyone. The report calls for all types of income to be taxed equally – hitting those earning from capital harder, and for IHT to be scraped and replaced with a tax on all gifts over a lifetime threshold of £125,000. The proceeds would go towards a Citizens Wealth Fund which would hand out £10k to 25-year-olds to spend on housing or starting a business. The left-leaning think tank also calls for a new National Investment Bank and for workers on company boards. Tech companies should pay a tax on UK sales rather than declared profits and 50% of workers should be involved with collective bargaining by 2030.

The Times, Page: 4 Financial Times The Guardian, Page: 12 Daily Mirror, Page: 16 Daily Express, Page: 6 The Sun, Page: 6 Daily Mail, Page: 1, 6-7 Yorkshire Post, Page: 4

Expert highlights disclosure window ahead of Scottish offshore income deadline

Taxpayers with undeclared income generated from offshore assets and investments have until October 1 to declare earnings or face hefty fines of 200% of underpaid taxes, a 50% surcharge for deliberate avoidance and being “named and shamed”. Ian Williams, a partner with Campbell Dallas, notes that a disclosure window applies however: “Qualifying disclosures will be subject to interest charges and the ‘general’ penalty regime, ranging from zero to 30%, but deliberate behaviour will attract significantly higher penalties”.

The Scotsman, Page: 39

Mourinho sentenced for £3m tax fraud

Manchester United boss Jose Mourinho has accepted a one-year prison sentence from Spanish prosecutors in relation to a €3.3m (£3m) tax fraud. Though he won’t actually serve time, in line with Spanish rules for first time offenders, he has been fined €1.98m (£1.78m) over charges relating to income for image rights in 2011 and 2012 which were claimed to have been funnelled through a British Virgin Islands company, Koper Services, and Irish and Swiss companies, before ending up in the New Zealand-based Kaitaia Trust – which had Mourinho’s wife and children as named beneficiaries.

Evening Standard The Sun, Page: 9 The Daily Telegraph The Times, Page: 17 Daily Star, Page: 16 Daily Mirror, Page: 4 Daily Mail, Page: 80

Welby’s intervention on tax not wholly appreciated

Reaction to Archbishop Justin Welby’s call for more taxes to pay for the levelling up of poverty hasn’t been wholly positive. Dr Welby contributed to a study by the Institute for Public Policy Research which called for higher taxes on wealth and multinationals and more state intervention to address economic “unfairness”. Not only are the tax and spend policies objected to by economists but so too is the intervention itself by Christians, who suggest Welby sticks to “talking about God” instead, as Jacob Rees-Mogg put it. A letter to the Express points out that the Church of England is worth about £7bn, with most of the cash held in tax-free endowment funds, so perhaps higher taxation should start there. The Sun’s leader points out that the richest pay 27% of all income tax, as opposed to just 11% under Labour in the 1970s, while low corporation tax has boosted employment. Overall, the tax burden is near a 30-year high; Welby’s “solutions are standard lazy Labour fare”. The Guardian asserts that Welby’s presence on the IPPR panel reminds us that economics should be an “ethical pursuit as well as a technical one” while the paper’s Owen Jones claims the report shows a “public appetite for radical reform” that could go even further. Nick Timothy says in the Telegraph that some of the policy ideas have value and that the Tories risk the “destructive policies” of Corbyn and McDonnell if they “defend a status quo with which the public is unhappy”. Finally, writing in the Telegraph, Jill Kirby, a former director of the Centre for Policy Studies, says it is depressing that the Archbishop used “his position to espouse the standard Left-leaning political prescriptions we can hear any day of the week” while economics professor Len Shackleton calls the report “a succe ssion of dubious empirical generalisations” in City AM.

The Daily Telegraph, Page: 12, 23 Daily Mail, Page: 21 The Times, Page: 24 The Sun, Page: 8, 12 Daily Express, Page: 48 The Guardian, Journal, Page: 2, 3 City AM, Page: 15

Thousands still to settle Rangers-style tax avoidance schemes

Up to 26,000 taxpayers set to be hit by the charge on loans they received as part of tax avoidance structures in the early 2000s, as highlighted in the high-profile case involving Scottish football club Rangers, are yet to settle their affairs with HM Revenue & Customs. Tom Wallace, of tax disputes specialist WTT Consulting, said many clients would go to court on the grounds that the employer should be targeted for national insurance and income tax – a precedent set by the Rangers case. Those who fail to meet the September 30 deadline will face a “loan charge” in April next year.

The Daily Telegraph

New tax penalty proposals unfair on taxpayers

The Association of Taxation Technicians (ATT) is urging HMRC to amend proposals for a new penalty regime for late payment of tax in order to avoid unfair outcomes for taxpayers. Unless the plan is amended, it would mean that taxpayers who had agreed with HMRC to pay tax liabilities by instalments could incur substantial penalties even on instalments which had been paid as agreed with HMRC.

Press Release

Scots income tax receipts £550m below forecast

Income tax receipts in Scotland were £550mn lower in 2016-17 than originally forecast by the Scottish Fiscal Commission (SFC) with the shortfall allegedly driven by an under estimate of the number of additional and higher rate income taxpayers north of the Border.

The Scotsman, Page: 9 The Press and Journal, Page: 16

CORPORATE NEWS

ENRC wins appeal in key legal privilege case

The mining group Eurasian Natural Resources Corporation (ENRC) has won an appeal against a High Court judgement last year which said the company must hand over documents prepared by an external law firm to the Serious Fraud Office. The Law Society warned the judgement might discourage firms from conducting investigations into themselves and self-reporting to the authorities. Judges at the Court of Appeal agreed, saying it was “in the public interest that companies should be prepared to investigate allegations… prior to going to a prosecutor such as the SFO, without losing the benefit of legal professional privilege for the work product and consequences of their investigation”.

The Daily Telegraph Financial Times The Times, Page: 35

Douglas leaves pub chain

James Douglas, the FD of pub chain Fuller, Smith & Turner has stepped down after 11 years.

Daily Mail, Page: 71

REPORTING NEWS

Dropping our mid-sized auditor makes no sense

A director says his company is switching to a Big Four auditor because of fears a smaller firm would be less independent – banning auditors from dual roles would re-build trust and eliminate such fears, he says.

Financial Times

Amortise goodwill swiftly and with a pre-set formula

Professor of Finance and Accounting at Cranfield, David Middleton, says the preferred way to amortise purchased goodwill and avoid conflict of interest is by using a pre-set formula.

Financial Times

Meaning of ‘true and fair’ not open to interpretation

To manage competing concepts of “true and fair”, Paul Norton suggests a simplification of accounting standards and the disclosure of auditors’ own views.

Financial Times

Jooste unaware of black hole

The former boss of Steinhoff, Markus Jooste, has told South African MPs that he was unaware of a black hole in the company’s accounts when he left the embattled retailer back in December. He informed lawmakers that he had no knowledge of accounting irregularities that caused the company to lose 95% of its market value. South African police are currently investigating Jooste over alleged fraud while PwC are still unpicking Steinhoff’s accounts.

Financial Times, Page: 17 Daily Mail City AM, Page: 11

PENSIONS NEWS

Government breaks pensions dashboard promise

The Federation of Small Businesses says the Government’s decision to pass responsibility for the creation of the pensions dashboard to industry lets down the UK’s self-employed community. The FSB’s Development Manager, Claire Reading said: “Ministers promised to get this sorted. They should have kept that promise. If we end up with an industry dashboard that doesn’t include information about the state pension then you’ll still have a proportion of the self-employed believing that their government top-up will get them over the line. That’s a really dangerous place to be.” In a statement to the Commons, the Department for Work and Pensions said the work it has done “in assessing feasibility for a pensions dashboard has made it clear that we should not underestimate the size or complexity of the challenge. An industry-led dashboard, facilitated by government, will harness the best of industry innovat ion.”

Press Release Parliament

SMEs NEWS

Calorie count rules will hurt small firms

New rules requiring restaurants, cafes and fast-food outlets to display calorie counts on their menus will disproportionately hit small businesses. The Department of Health’s proposals aim to combat obesity, but Liz Truss, the Chief Secretary to the Treasury, accuses the DoH of underestimating the impact on SMEs, which she estimates could face average costs of £500 for each menu change.

The Daily Telegraph, Page: 1

RBS bank branch closures blow to small firms

The Federation of Small Businesses laments RBS bank branch closures following the announcement that 54 more will close across England and Wales. FSB Development Manager, Claire Reading, said the losses would further hurt small businesses which value bank branch access. “Demand for new finance among small firms is already low, hampering their expansion and wider economic growth. A diminished branch network could well make a bad situation worse.” The latest cull comes on top of 421 closures announced since December last year, taking the total since then to 475.

Press Release The Daily Telegraph, Business, Page: 1 Daily Express, Page: 10 The Guardian, Page: 32 City AM, Page: 3

FSB demands urgent help for struggling high streets

The Federation of Small Businesses has called for town centres to be thrown a “lifeline” by reforming business rates and changing the tax rules to make it easier for small retailers to expand. The FSB wants a freeze on rates from April 2019; a £1,000 discount for local shops, cafes, restaurants and pubs; extra relief for small firms in London, and a faster appeals process. Access to cash and banking services also was vital and investment in roads and parking was needed to make it easier for shoppers to visit high streets. Mike Cherry, chairman of the FSB, said: “Small business owners are resilient and are used to adapting to market forces, but we want to see government and local authorities come together to look at real solutions to these issues so that our high streets are not only able to survive, but to thrive.”

The Times, Page: 41 Daily Mail, Page: 19 Daily Mirror, Page; 18 City AM, Page: 8

SME-focused lender aims for overseas expansion

Small business fintech lender OakNorth has completed a $100m fundraising to help license its artificial intelligence loan system to banks outside the UK.

Financial Times, Page: 18

PROPERTY NEWS

Cable calls for business rates to be replaced with a land tax

Writing in City AM, Vince Cable says business rates are a tax on investment and suggests a new tax – the Commercial Landowner Levy (CLL) – based solely on land value (thereby excluding premises and machinery from calculations) and paid for by landowners rather than businesses. The idea has been expounded in a report called “Taxing Land, Not Investment” by Andrew Dixon, founder of the Liberal Democrats Business and Entrepreneurs Network.

City AM, Page: 14

ECONOMY NEWS

Brexit must bring bold economic reform

John Mills, the chairman of consumer goods business JML, says in the Telegraph that, with “effort and determination”, Britain will prosper outside the EU. But the founder of Labour Leave and member of the IPPR Commission on Economic Justice, which issues its Plan for the New Economy today, believes the economy needs restructuring away from financial services towards manufacturing. Mills calls for a fairer economy and a “new industrialisation” to diversify and grow our exports. The IPPR’s report asserts that the UK is being held back by a business culture dominated by decades of short-term profit-taking, weak levels of investment and low wages.

The Daily Telegraph, Business, Page: 2 Financial Times The Guardian, Page: 12

August slow for housebuilders

Construction industry activity cooled in August as housebuilders felt a “particularly sharp slowdown” and infrastructure projects dried up, the PMI for the construction sector shows. The index fell from 55.8 in July to 52.9 in August. “This raises concerns that the UK economy is flagging”, Howard Archer, chief economic adviser to the EY Item Club, said.

The Times, Page: 34

UK services sector activity accelerates in August

Britain’s services sector picked up the pace in August, according to IHS Markit’s purchasing managers’ index, which rose to 54.3 from 53.5 in July. New orders accelerated and hiring rose to its strongest level since February, while wages increased to encourage retention and attract new workers. However, business expectations for the year ahead sank largely due to increased anxiety over Brexit negotiations. Howard Archer, chief economic adviser to the EY Item Club, said that, as a result, it “looks unlikely that interest rates will rise again until after the UK leaves the EU in March 2019”.

City AM Financial Times The Daily Telegraph The Guardian, Page: 32

OTHER NEWS

Carney deigns to help smooth Brexit transition

Mark Carney told MPs yesterday that he was willing to stay on as governor of the Bank of England beyond his planned departure date in order to “smooth” the Brexit process. Mr Carney had planned to step down in June 2019. He warned that Brexit would bring a “real income squeeze” but the Bank would “do what we could do to support and ease that adjustment”.

The Independent Financial Times The Daily Telegraph

Consumer borrowing shift from private to public

A National Audit Office report says local authorities and Government departments are deemed worse than private sector creditors for the heavy-handed way in which they collect debts and manage people in arrears. The NAO estimates that problem debt costs taxpayers £248m a year and the wider economy £900m a year. “The government lags behind the retail lending sector in following good management practice,” the report says, with only 19% of councils adopting best practice guidelines. Since tighter rules on private borrowing and debt collection were introduced consumer borrowing shifted markedly from private credit providers to the state.

The Times, Page: 36 The Sun, Page: 18 The Daily Telegraph, Business, Page: 8 The Independent, Page: 61 Daily Mirror, Page: 52 The Guardian, Page: 31 Financial Times, Page: 2

Contact Paul Southward if you have any queries.

Paul Southward


News Roundup Wednesday 5th September 2018


News Roundup Wednesday 5th September 2018

NEWS ROUNDUP

TAX NEWS

Companies pay up to avoid Google Tax stigma

Patrick Hosking reports that multinationals are paying hundreds of millions in extra tax bills to avoid the embarrassment and reputational damage of being seen as paying the diverted profits tax. He cites the case of Diageo, which agreed in July to pay an extra £190m in conventional corporation tax in order for HMRC to return £107m it had paid previously in DPT. The new regime was introduced to combat the loss of revenue when international companies booked high profits in low-tax jurisdictions and lower profits or losses in Britain to reduce their overall tax bills and it is set at a higher rate than corporation tax. HMRC has rapidly increased its issuance of DPT notices. Andy Wood, a director of Enterprise Tax Consultants, said: “The size of the amount paid up in the Diageo case perhaps shows the premium companies place on their good names and how far they will go to avoid the stigma of the Google Tax.”

The Times, Page: 31

MPs back gong block for tax avoiders

Many politicians have welcomed news that HMRC is issuing warnings to the Cabinet Office over honours nominees it considers to have misbehaved financially, but most would prefer it if they just forced them to pay the right amount of tax. The Times points out that Edward Troup, the senior HMRC official who signed an agreement to provide confidential tax information to the compilers of the honours list, was knighted several months later. The Mirror’s Kevin Maguire thinks the logical extension of HMRC’s warning system is to strip knighthoods from tax haven tycoons such as Richard Branson, Philip Green or Jim Ratcliffe, unless they bring every penny back onshore.

The Times, Page: 13 The Times, Page: 13 Daily Mirror, Page: 8

Hammond told to forget tourist tax

Hospitality industry leaders have urged the Chancellor to abandon any plans to introduce a tourist tax, warning it would wreak havoc “on an already strained and over-burdened sector”. FSB chairman Mike Cherry said: “Our visitor economy is a huge success story, contributing more than £125bn to the economy annually and providing vast tax receipts to pay for public services. Small firms operating in the tourism sector are already up against high business rates, rising employment costs and surging input prices, particularly where utilities are concerned. Adding tourist taxes to the mix would mean yet another reason for small B&B, hotel and hostel owners to spend time away from running and growing their firms.”

The Daily Telegraph, Business, Page: 3

Taxman opens 27 new serious tax evasion cases

Research by Pinsent Masons has revealed that HMRC opened 27 new investigations into suspected serious tax evasion by some of the UK’s top businesses in the last year. Partner Jason Collins says the probes do not mean evasion has taken place and they may have been triggered by irregularities resulting from new procedures businesses are putting in place to comply with the Criminal Finances Act 2017, which makes corporates liable for employees, agents or those providing services.

economia

Don’t tax innovation to save traditional shops

The Times’ Patrick Hosking disputes claims that the high street needs to be helped with extra taxes placed on online sellers like Amazon. There is already a level playing field, he asserts, and ultimately the “unpalatable truth is that online retailers by and large are winning not because of their tax advantage but because they are producing a better service compared with many traditional shops.” Using taxes to slow the advance of online shopping would only signal “that innovation and investment should be penalised and stasis and under-investment rewarded.”

The Times, Page: 45

Donate your art to reduce your tax liabilities

The Telegraph’s Sam Meadows details how donating works of art can reduce your tax bill. The Cultural Gifts Scheme, which was introduced in 2013, allows donors to save money on income, capital gains and corporation tax by giving away culturally significant items. Nimesh Shah of Blick Rothenberg said: “The Government wants these items of national significance to be accessible so the public can see them. A lot of the world is quite envious of the cultural tradition we have in the UK and this is quite a noble scheme from the Government to encourage donations.”

The Daily Telegraph

Coca Cola warned over Costa tax ruse

Labour MP Peter Kyle, who sits on the BEIS Committee, has warned Coca Cola that it would face a full investigation if its purchase of Costa Coffee looked like a restructuring would reduce its UK tax liabilities.

Daily Mail, Page: 64

REPORTING NEWS

Spotlight is on auditors, but plenty of others have an equal responsibility

Jane Fuller, a member of the Audit and Assurance Council of the FRC, says not just auditors, but NEDs, investors, analysts and journalists also have a responsibility to hold management to account.

Financial Times, Page: 10

In defence of quarterly reporting

Peter Malmqvist, the Chairman of the Swedish Association for Financial Analysts, says that, despite a requirement for half and full-year reporting, Swedish companies stuck with quarterly reports. Elsewhere, Nicolas Moreau, the CEO of European asset manager DWS, has defended quarterly reporting, describing it as a “highly important tool” for investors.

Financial Times, Page: 10 Financial Times, FT, Fm, Page: 1, 2

Ending quarterly reports will not stop corporate short-termism

Former US Treasury secretary Lawrence Summers dismantles arguments claiming less frequent reporting would combat an excessive corporate focus on the short term.

Financial Times, Page: 11

SMEs NEWS

New firm will link family offices with start-ups

A group of investors including Sir John Hegarty, a founding partner of Saatchi & Saatchi, and Michael Jackson, former chairman of Sage, have launched YYX Capital, a new firm that will co-invest with “family offices” and individuals in consumer internet, ecommerce and software start-ups. Mr Jackson, chairman of YYX Capital, said that the firm’s interests would be aligned with its clients’ since it would “only make money when they do”. YYX investment partner Julian Barnett said linking early stage businesses with family offices is a niche in the market which has been “critically underserved”.

The Times, Page: 39

HSBC pushes small business lending initiative

HSBC has hired more than 100 new staff to work on Project Iceberg at its Aldwych office. The digital initiative aims to revamp its small business banking effort and to defend against Shoreditch’s fintech stars.

City AM, Page: 3

Funding Circle confirms hefty IPO

Funding Circle has confirmed plans to float in a move which could value it at £2bn. The small business loans platform also posted results showing it had almost doubled revenue in 2017, making £94.5m compared to 2016’s £50.9m.

Financial Times Evening Standard The Guardian, Page; 28 The Daily Telegraph, Business, Page: 1, 5

WEALTH MANAGEMENT NEWS

Boylan moves to Brewin Dolphin

Brewin Dolphin has appointed LGIM CFO Siobhan Boylan as finance director. Ms Boylan is expected to join Brewin Dolphin in early 2019, subject to regulatory approval

Financial Times, FT Fm, Page: 3

True Potential shines through

Newcastle-based wealth management platform True Potential, used by many UK independent financial advisers (IFAs), has appointed bankers from Perella Weinberg Partners to help plot a sale that could value it at close to £2bn. The fintech firm is owned by 739 individual partners, with a minority stake held by US-based private equity firm FTV Capital.

Sky News

ECONOMY NEWS

Manufacturers maintain resilience

A quarterly report from the EEF and BDO has said that factory output and orders were “still very much in the black” over the past three months and were likely to continue to be for the rest of the year. Tom Lawton, head of BDO’s manufacturing department, said: “Despite [continuing] uncertainty, UK manufacturers continue to demonstrate resilience and some confidence in at least the short-term future.” However, the EFF said momentum had faded and downgraded its growth forecasts to 0.9% this year and 0.5% next, from 1.9% and 0.5% estimated in June.

The Times, Page: 32 Yorkshire Post, Business, Page: 15

Minimum wage lift could give urban regions a £1bn-plus boost

A study by the Smith Institute suggests that a small increase in the minimum wage in Britain’s main city regions would encourage employers to deploy workers more productively and help boost local economies by more than £1bn. The Guardian’s Phillip Inman notes that employers like KPMG have adopted the higher, voluntary living wage, and called on suppliers and clients to adopt it too.

The Guardian, Page: 30 The Scotsman, Page: 2 Yorkshire Post, Page: 4

Fox dismisses Treasury’s Brexit predictions

Liam Fox has refused to back Chancellor Philip Hammond’s warning that a “no-deal” Brexit could damage the economy. Speaking on the BBC‘s Andrew Marr Show, the International Trade Secretary said: “This idea that we can predict what our borrowing would be 15 years in advance is just a bit hard to swallow.”

BBC News

Manufacturing confidence lowest since Brexit referendum

British manufacturing in August grew at its slowest pace in over two years, according to IHS Markit’s latest purchasing managers’ index (PMI) for the sector, to a 25-month low of 52.8 for the month. Business confidence was at a 22-month low, with 47% expecting higher production in a year’s time. The growing opposition to Theresa May’s Brexit plan combined with the slump in UK manufacturing growth pushed Sterling to its lowest level against the euro in four months.

The Daily Telegraph Financial Times The Daily Telegraph Financial Times Daily Express, Page: 51 The Guardian, Page: 28

Consumer spending on the rise

According to data from Barclaycard, consumer spending rose by 4.5% in August compared with the previous year. Entertainment saw the biggest jump in spending as ticket sales climbed by 8.6% and spending in pubs increased by 11.9%. Meanwhile, figures from the British Retail Consortium-KPMG sales monitor showed that retail sales growth slowed in August, increasing by just 0.2% on a like-for-like basis compared to the same month in 2017.

The Times, Page: 44 Financial Times, Page: 3 Daily Mail I, Page: 43 Yorkshire Post, Page: 4

Economy 2% smaller than it would have been without Brexit

Research by UBS suggests the UK economy is already 2% smaller than it would have been had the public not voted to leave the EU, while investment is 4% lower and consumption 1.7% down.

The Daily Telegraph

OTHER NEWS

Carillion collapse led to a fall in public trust in business

The Telegraph’s Tim Wallace says peoples’ trust in business has plummeted since the collapse of Carillion, with a CBI survey finding just 56% believe businesses have a good reputation, compared with 65% last October. Individuals’ own interactions with firms are better, however, with 80% saying they have a positive relationship with their employer, a rise of 11 percentage points on the year. The CBI study also found 92% would welcome comments from business on political issues such as immigration, climate change and gender equality.

The Daily Telegraph, Business, Page: 4

Countingup raises £2.3m seed

Fintech firm Countingup, which meshes business banking with bookkeeping, has raised £2.3m in seed funding. It already has 4,000 active customers and is signing up new users at a rate of 1,500 businesses per month. Founder Tim Fouracre’s vision is that business banking and accounting software should be merged so that bookkeeping and filing accounts can be largely automated.

Tech Crunch

Over 60s benefits “difficult to justify”

The ATT has said if the qualifying age for free eye tests and prescriptions was be raised from 60 to the state pension age it would save £1bn a year. Many over 60s are working and could afford to pay for a variety of services they currently receive for free, saving the Government £27bn it could invest in the NHS.

The Times, Page: 48

Judge approves mentally ill mother’s £6m gift for son

A judge has ruled that a son should be allowed to give himself £6m from his mentally incapacitated mother’s £18.6m fortune to reduce inheritance tax liabilities.

The Times, Page: 25 The Daily Telegraph, Page: 2

Contact Paul Southward if you have any queries.

Paul Southward


News Roundup Friday 31st August 2018


News Roundup Friday 31st August 2018

NEWS ROUNDUP

TAX NEWS

Scrap tax relief for entrepreneurs, says think tank

The Resolution Foundation has said entrepreneurs’ relief should be scrapped to help to fund the government’s £20bn pledge for the NHS. The think tank said the tax break is “expensive, ineffective and regressive” at an estimated £2.7bn a year and “has good claim to being the worst of Britain’s main tax reliefs”. It also said there is “no evidence that it has led to any substantial increase in genuine entrepreneurship.” The relief was introduced in 2008 by Alistair Darling in response to a row over changes to CGT and was intended to encourage people to start or join new companies by promising a lower rate of CGT on their investment when they sold out. The generosity of the scheme has since been extended so that start-up owners pay half the 20% rate of CGT on up to £10m of gains, with a maximum individual benefit of £1m.

The Times, Page: 34

Tax complainants encouraged to use adjudicator

The Mail reports that HMRC has dismissed tens of thousands of complaints about incorrect tax bills, codes and unpaid credits without referring them to an independent adjudicator. Tax experts say many people are unaware they have the right to escalate their complaint to the Adjudicator’s Office, where they can get an impartial hearing. Chas Roy-Chowdhury, head of taxation at the ACCA, said: “Some people don’t want the hassle of going to the adjudicator. Others are worried they may get into more trouble if they lose. But this service is free and open to everyone so more people should use it.”

Daily Mail, Page: 41

Toxic mix’ of tax rules and pensions

Malcolm McClean, senior consultant at Barnett Waddingham, comments on complex tax rules such as the tapered annual allowance for high earners, writing: “Apart from a few accountants and other self-appointed ‘experts’, I am not sure there are many people who fully understand how the taper works.” He also questions the need for the lifetime allowance and money purchase annual allowance.

Professional Advisor

Tax incentives drive video games growth

Use of tax incentives to drive growth in the UK’s video game industry has risen by over 30% in the last year, according to Moore Stephens. Statistics from HMRC show £105m was claimed in Video Games Tax Relief (VGTR) in 2017/18, up from £79m in 2016/17.

London Loves Business

Corporation tax receipts rocket

Figures from the Office for Budget Responsibility show corporation tax receipts have surged since the rate was cut. The levy raised £57.6bn last year, when firms handed over 19% of profits. That was 44% more than in 2010 when corporation tax was 28%. Corporation tax receipts have also risen 26% since the EU referendum. Sam Dumitriu of the free market Adam Smith Institute think-tank said the figures should prompt ministers to reduce tax on firms which invest. “A competitive corporate tax rate has made Britain a more attractive place to do business,” he said.

Daily Mail, Page: 69

HMRC offers guidance on digital tax accounts

HMRC has published a set of materials to provide clarity on digital tax accounts, amid concerns that too many company owners are still in the dark. Although the materials are also aimed at accountants, much of the practical guidance is intended for businesses facing the mandatory MTD VAT service from April 2019.

Contractor UK

SMEs NEWS

Africa ties are good for small firms

The Federation of Small Businesses has welcomed Theresa May’s plans to boost Britain’s investment in Africa after Brexit. Mike Cherry, national chairman, said strong trade ties with Africa will be crucial after Brexit, with 35% of the FSB’s exporting members sending their goods to Africa.

The Independent, Page: 3 The Guardian

Scottish firms benefit from £32m rates cut

Last year’s business rates shake-up in Scotland has saved more than 4,000 businesses around £32m in total. Since the rates revaluation, there have been 73,845 appeals lodged, more than 16,000 of which have been resolved so far. Of those, 4,180 firms had £69m wiped off their rateable value, meaning their rates bill is now £32m lower. A Scottish government spokesperson said: “We have delivered the most competitive business rates package of reliefs in the UK, funding rates relief of around £720m in 2017-18. We are also taking forward the recommendations of the Barclay Review, which recognised that reform of the appeals system is needed to modernise the approach, reduce appeal volume and ensure greater transparency and fairness.”

Daily Express The Herald

SME owners to write RBS report

SME Alliance, a group of business owners, are compiling a report into Royal Bank of Scotland’s alleged misconduct. They claim their report will cover new evidence related to the bank’s global restructuring group. This follows the Financial Conduct Authority saying regulatory action was not possible as commercial lending activities fall outside the scope of its powers. City AM says the regulator could still examine any new evidence it receives.

City AM The Daily Telegraph, Business, Page: 28

PENSIONS NEWS

Lump sum payouts putting pension schemes at risk

The Pensions Regulator has warned that “overly generous” lump sum payouts to people in retirement could be putting pension schemes at risk. It has urged 14 company retirement schemes to review their cash sum offers. The amount withdrawn from the traditionally generous company pension plans has risen from £7.9bn in 2016 to £20.8bn last year, according to figures from the Financial Conduct Authority.

The Times, Page: 37 Financial Times, Page: 1 The Daily Telegraph, Page: 2

ECONOMY NEWS

Hot summer brings an end to falling shop prices

The summer heatwave has pushed shop prices into inflationary territory for the first time in five years, according to the British Retail Consortium. Prices in the shops rose by 0.1% in August compared with a year earlier, the first time they have increased since April 2013.

The Times

Land values raise UK’s wealth to £10trn

The net value of all of the UK’s assets topped £10trn for the first time in 2017, thanks to surging land and house prices. The ONS said almost all of the rise to £10.2trn from £9.75trn was fuelled by a £450bn rise in land values. Housing wealth now makes up 17.8% of the UK’s net worth, and added to land this takes the two to a total of 70.7% of net assets. The steady increase in land values is expected to trigger further calls for a land value tax or new rules allowing local authorities to benefit from the rise in values by allowing them to buy land earmarked for development.

The Guardian, Page: 29 The Daily Telegraph Financial Times, Page: 2 The Times, Page: 36

OTHER NEWS

Carney asked to stay on as BoE governor

Mark Carney has reportedly been quietly approached by the Government to stay on as BoE governor for another year. It is understood that the Treasury is keen for him to stay on until 2020 so that he can provide continuity during the turbulence of Brexit. However, a Treasury spokesperson denied it had approached Mr Carney and said the government was still planning to advertise for the position “in the next month or two”.

Evening Standard The Daily Telegraph, Business, Page: 27 The Times

Contact Paul Southward if you have any queries.

Paul Southward


News Roundup Wednesday 29th August 2018


News Roundup Wednesday 29th August 2018

NEWS ROUNDUP

TAX NEWS

Aim to invest wisely

The Times’ Mark Atherton highlights concerns that investors are putting money into Aim stocks purely because of the tax savings on offer. Jason Hollands of Tilney suggests that IHT mitigation represents a significant chunk of the money invested in Aim, which could skew the objectives of these IHT portfolios. Elsewhere, the FTlooks at how the government’s Enterprise Investment Scheme (EIS) is attracting investors by offering income tax relief of 30% on up to £1m per year.

The Times, Page: 61 Financial Times, Money, Page: 6-7

Celebrities’ tax adviser hit with £50m bill

A tax adviser that helped celebrities to invest in film schemes has been hit with a £50m demand by HMRC. The move is the latest development in HMRC’s long-running battle against Ingenious Media, whose clients included David Beckham and the PR supremo Matthew Freud. Ingenious, founded and led by accountant Patrick McKenna, is fighting two demands, which add up to £47.3m plus interest. The disputed tax liability relates to relief claimed by Ingenious companies for investing in film and video partnerships. Ingenious said the latest HMRC claim was against an Ingenious company that is separate from its current operations and the size of the claim was based on a “deeply flawed” tax tribunal decision.

The Sunday Times, Business, Page: 1

Hammond plans to hammer pensions to fund NHS

The Mail on Sunday reports that Philip Hammond is targeting the pensions of thousands of higher-rate taxpayers to fund Theresa May’s £20bn-a-year boost for the NHS. A government source said the chancellor had identified the £38bn which is paid out from the public purse each year in pension tax relief as “one of the last remaining pots of gold we can raid.” Mr Hammond may also remove historic tax breaks for investors who plough money into small companies in November’s Budget as he tries to find the money needed to fulfil the Prime Minister’s pledge.

The Mail on Sunday, Page: 2

Hammond facing backlash over tax-raising plans

Pensions experts have warned Philip Hammond against raiding middleclass savers’ pensions to fund a public spending spree. The chancellor is reportedly plotting to cut tax relief in an effort to raise an extra £20bn for the NHS. Baroness Ros Altmann, an ex-pensions minister, said: “There’s a huge amount of resentment against changes of this kind, particularly among Conservative voters, because there would be quite a lot of losers.” Steve Webb, policy director at Royal London, added: ‘Pension tax relief shouldn’t just be used as a pot of cash when money is short.” Meanwhile, the Mail’s leader criticises plans to target small business investors, the self-employed and those who save into private pensions. It accuses Mr Hammond of wanting to tax enterprise, initiative and thrift.

Daily Mail, Page: 2, 16

Lack of action on tax crime comes as no surprise

The Independent’s Chris Blackhurst says the fact that only three unexplained wealth orders have been served in the six months since the instrument’s introduction is unsurprising. He says that politicians have for decades promised to crack down on tax avoidance and corrupt wealth, with no apparent effect. He adds: “The City of London is full of lawyers, accountants and financial advisers who specialise in defeating investigators and hiding wealth. To assist them, we have a hideously detailed tax code – more convoluted than that of India – which is full of get-outs and exclusions.”

The Independent, Page: 59

Experts call for rethink of IR35 plans

Qdos Contractor has compiled a series of measures devised by IR35 experts that the government should consider before implementing off-payroll tax reforms in the private sector. Measures proposed include: linking employment rights to tax status; granting ‘IR35 Passports’; a more nuanced approach to sectoral impact; and exemptions for the smallest businesses.

Crystal Umbrella

Closing IHT ‘loopholes’ could be counterproductive

Colin Henderson, partner at Anderson Strathern, warns that introducing a separate inheritance tax regime for Scotland could just create more complexity. He predicts there would be many cases where establishing if someone’s permanent home was in Scotland or elsewhere in the UK would be problematic and “it would not be in anyone’s interest to deal with two separate tax authorities.”

The Scotsman

Retail body wants zero rate tax band

The Scottish Retail Consortium has called for a zero-rate of income tax for low-earners to be central to the next Scottish budget, as part of efforts to help business.

The Scotsman, Page: 9 The Press and Journal, Page: 33

CORPORATE NEWS

Judge clears way for Chappell appeal

Former BHS owner Dominic Chappell will appeal his conviction for breaching pensions laws next month. The 51-year-old was ordered to pay more than £87,000 after being found guilty in January of failing to provide information to investigators about the retailer’s pensions schemes when it collapsed with the loss of thousands of jobs. At a preliminary hearing at Hove crown court, his solicitor, Michael Levy, said The Pensions Regulator was put under political pressure to take action against Mr Chappell.

Financial Times The Guardian Daily Mail

Homebase creditors urged to back CVA

Creditors to DIY retailer Homebase have been urged to back a CVA next week or risk seeing the chain collapse into administration or liquidation. A proposed CVA would see 42 stores close by next year with the loss of up to 1,500 jobs. The retailer is also seeking rent reductions of 25 to 90% at 70 stores. The Express highlights that a document prepared for landlords and other creditors is understood to show that over 70% of Homebase’s 241 shops are currently loss-making.

The Daily Telegraph, Business, Page: 35 Financial Times, Page: 14 Daily Express, Page: 62 The I, Page: 69 Daily Mail, Page: 103

‘Phoenixing’ bosses face bans

Directors who allow companies to go bust to avoid debts could be disqualified and fined under new powers for the Insolvency Service. Ministers want to curb so-called “phoenixing”, where liabilities such as pension deficits and supplier payments are left behind by companies who then re-emerge under a different name with a clean bill of health. The proposals will enable the Insolvency Service to take enforcement action against directors of dissolved companies for the first time. The new powers, to be outlined in further detail this autumn, will focus on directors who sell a subsidiary only for that company to collapse into insolvency within one year. However, Adam Marshall, director-general of the British Chambers of Commerce, warned: “In genuinely difficult situations, who’s going to be the arbiter, because not every situation is a BHS where it’s very clear that things were handled badly.”

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

Homebase landlords rebel over CVA

A group of powerful landlords is considering legal action over Homebase’s attempt to slash its rents by as much as 90%. The DIY chain has asked creditors to approve a CVA that would see 42 stores closed and rents cut by between 25% and 90% on 70 others. However, property owners including M&G and Aberdeen Asset Management are understood to have hired the law firm Hogan Lovells to push for better rent terms or embark on legal action. Begbies Traynor is reported to be working with a separate group of Homebase landlords.

The Sunday Times, Business, Page: 1 Sunday Express, Page: 53-54

SMEs NEWS

Banks failing to back small firms

A former senior financier has accused banks of adding to the pressure on high streets by failing to support small businesses when they hit financial difficulties. Business guru Rob Rutter warned: “Banks have become so slow and bureaucratic they are acting as a handbrake on the economy rather than an accelerant.”

Sunday Express, Page: 10

Bailiffs sent to 81,000 struggling firms

Bailiffs visited 81,000 companies struggling with new business rates last year. An investigation by ratings adviser Altus Group found that bailiffs were sent to 222 premises across England every day in 2017-18 because of business rate arrears. Altus found that 6.53% of firms liable for rates – nearly one in every 15 commercial properties with a bill – faced having their goods seized, up from 6% the year before.

The Sun, Page: 2 Daily Express, Page: 42 The Independent, Page: 56

Lack of Brexit planning puts SMEs at risk

The Times highlights concerns about the potential impact of a no-deal Brexit on SMEs. Research published last month found that the majority of mid-sized companies had done no planning at all for Britain’s exit and that their smaller counterparts were likely to be even less prepared. The FSB has warned that smaller companies will be “the least able to cope” with such a “cliff-edge moment”.

The Times, Page: 38-39

PROPERTY NEWS

Stamp duty hikes are paralysing the market

The Mail cites figures which suggest stamp duty increases introduced by George Osborne are paralysing the housing market and costing the Treasury hundreds of millions of pounds in lost revenue. The figures from the ONS show that HMRC received £4.27bn from stamp duty between April and July. However, that was £364m – or 7.9% – less than in the same period last year. Meanwhile, a YouGov survey has found that scrapping stamp duty for the over 65s would encourage nearly 3m pensioners to downsize and free up large homes for younger families. The poll found that 22% of older people would be more likely to move if they were given a one-off exemption from paying the tax .

Daily Mail, Page: 34 The Daily Telegraph, Page: 15

Buyers go north to beat stamp duty trap

The number of Londoners relocating to the Midlands or north of England has more than tripled in the past decade in response to soaring house prices, high stamp duty costs and sluggish wage growth. Aneisha Beveridge, research analyst at estate agent Hamptons, said: “More people are making a bigger move and buying a larger home sooner to avoid having to pay stamp duty on additional moves as they trade up. But for many, this means heading further north.”

The Times

PENSIONS NEWS

No jump in pension opt-outs

Opt-outs from the government’s auto-enrolment scheme have not risen as anticipated after higher contributions began in April. Workers were forced to begin paying 3% of their salary into a pension earlier this year, up from 1% before, with the option to drop out if they could not afford it. Analysis by Legal & General Investment Management found that opt-out rates showed “no jump in April and May”.

The Guardian

Public sector pensions dwarf private provision

Analysis by the TaxPayers’ Alliance has found public sector workers will retire on pensions three times larger than their private sector counterparts. The report predicts a new private sector employee aged 25 on the national average wage would retire with an average pension of 22% of their final salary, versus 61% for a worker in the public sector. Meanwhile, a report from the Centre for Policy Studies warns that pensions saving in Britain has plunged to a record low. Households are investing just 4.9% of their income for the future, the lowest level since records began in 1963. The think tank argues that millions of people have been put off saving for their retirement by the “incomprehensible” pension tax relief system.

The Daily Telegraph, Page: 10 The Times, Page: 13 The Sun, Page: 2 Daily Express, Page: 9

ECONOMY NEWS

Consumers dipping further into savings

Consumers are continuing to dip into their savings to maintain their current levels of spending, as growth in personal deposits drops to a 11-year low. According to UK Finance, the rate at which Britons add to their savings has slowed dramatically over the past year, with growth in personal deposits falling to 1.2% last month.Figures from UK Finance have also revealed that mortgage approvals fell to 39,600 in July, down from 40,300 in June, as the UK housing market continued to show signs of slowing down. Total mortgage lending, however, rose in July to £24.6bn – a rise of 7.6% on the same month last year.

The Times, Page: 52 Financial Times The Independent

UK banks loosen mortgage standards to maintain growth

Britain’s banks are relaxing lending standards and reducing fees in order to maintain growth, as profit margins are hit by competition and a weakening housing market

Financial Times

OTHER NEWS

HMRC callers facing longer waits

HMRC’s annual report reveals the tax authority is taking longer to answer phone calls because it overestimated how many would use the internet. Last year it took the Revenue an average of 4 minutes 28 seconds to answer the phone – more than 30 seconds slower than the year before. Almost 15% of callers waited more than ten minutes to be answered. The report admits the delays are down to the fact that HMRC expected more people to be using its digital services. Age UK said that Government bodies should be forced by law to ensure they have decent services for those who do not wish to use websites.

Daily Mail, Page: 59

Champion wrestler could have been an accountant

Wrestler Zack Gibson, the winner of this year’s WWE UK Championship Tournament, could have followed a much different career path, having studied accountancy before finding success in the ring. “I have to work really hard because I’m naturally skinny. I think God wanted me to be an accountant!,” he says.

Daily Mirror

Contact Paul Southward if you have any queries.

Paul Southward

Paul Southward


News Roundup Saturday 25th August 2018


News Roundup Saturday 25th August 2018

NEWS ROUNDUP

TAX NEWS

“Grossly unfair” HMRC lifts late payment interest rate

HMRC has raised the rate it charges people and businesses for late tax payments by 0.35 percentage points to 3.25%. The move follows the Bank of England’s latest quarter-point rate rise to 0.75%. The repayment interest rate – the rate HMRC levies on top of sums it owes to taxpayers – has remained at 0.5% since 2009. Tom Selby, a senior analyst at investment platform AJ Bell, said: “It seems grossly unfair for HMRC to increase the late payment rate for those who owe it money without doing the same thing when it owes other people money”.

The Times

HMRC begins rollout of new customs software to importers

HMRC has launched the rollout of the Customs Declaration Service, a system in development since 2013 and expanded since the EU referendum to deal with the expected increase in declarations after Brexit. The first software release has been made available to a selected group of importers, who will start making certain types of supplementary declarations on the new system from this week, in the initial step of a three-phase rollout lasting until early next year.

Holyrood

Corbyn will tax tech firms to subsidise the BBC

Jeremy Corbyn is set to propose a new tax on tech firms such as Facebook, Google and Netflix to subsidise the BBC’s income and to enable it “to compete far more effectively with the private multinational digital giants”. The tax would also support a new public interest journalism fund. Investigative websites that could demonstrate they “take on the powerful” would be exempt from taxes. The corporation would also be forced to reveal the social class of all of its contributors.

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

Labour pays no tax on £56m income

The Labour party raised a record income of nearly £56m in 2017, figures show, but paid zero corporation tax despite a £1.4m surplus in the bank. A spokesman said: “The party made no taxable profits; therefore, no corporation tax was due. We pay all tax that is due and always will.” But Tory MP Chris Philp said: “This is sickening hypocrisy from the Labour Party.” The Tories raised £45.9m and paid tax, the Mail says.

The Sun, Page: 2 Daily Mail, Page: 4

Britain needs mould-breaking Budget

The Telegraph’s Allister Heath says Philip Hammond should use his Autumn Budget to slash corporation tax from 19% to 12.5%, thereby “sending a resounding message to the world that Britain is back.” He also calls on the chancellor to halve stamp duty immediately and cut capital gains tax on all assets to 18%. “Brexit Britain is crying out for an emergency, mould-breaking Budget,” he concludes. Elsewhere, the Sun’s leader also argues that the UK’s corporation tax should be as low as Ireland’s and that stamp duty must be slashed to get the housing market moving.

The Daily Telegraph The Sun, Page: 10

ACCA condemns HMRC interest rate change

The ACCA has said it is “simply unfair” that people owing tax have seen a rise in the interest they pay, while those owed a refund will see no change. It comes after HMRC raised the rate it charges people and businesses for late tax payments by 0.35 percentage points to 3.25%, while the repayment interest rate has remained at 0.5%. Chas Roy-Chowdury, head of taxation at ACCA, said that there should be a level playing field.

BBC News

Tax overhaul could hit oil and gas firms

Euan Smith in the Scotsman says the UK government’s plans to introduce tougher tax regulation to the private sector which would mirror that in the public sector will have a negative impact on oil and gas firms. He suggests that if contractors are to be treated as “employees” as far as tax and NI is concerned, they may take the view they are better off being full-time employees on payroll, enjoying the benefits associated with employment status.

The Scotsman, Page: 35

Amazon tax ‘will reduce productivity’

Brian Monteith, director at Global Britain and a former member of the Scottish Parliament, brushes off Chancellor Philip Hammond’s proposals for both an “Amazon tax” and a levy on vaping. An Amazon tax will not raise revenues for the government, he argues, it will reduce UK productivity and customers and online retailers will seek ways to avoid the tax.

City AM

SMEs NEWS

Businesses cautiously welcome no-deal guidance

Adam Marshall, director general of the British Chambers of Commerce, has welcomed the Government’s decision to publish its no-deal strategy documents, although he said preparation should have happened “far earlier”. Allie Renison, Head of Europe and Trade Policy for the Institute of Directors, said the government needs to ensure the no-deal information “trickles down to all businesses in the supply chain, particularly to smaller firms which are typically less resourced, and are less likely to have made preparations so far”. Federation of Small Businesses chair Mike Cherry agreed that smaller firms are most vulnerable, saying: “If you are a small business that trades with the EU or employs someone from the EU, or if you a self-employed EU citizen working in the UK, you need easily accessible information that will explain how a sudden Brexit will impact you and your business while providing practical steps to soften this impact.”

The Independent, Page: 6

North of England ‘braver’ about Brexit than London civil service

Northern Powerhouse minister Jake Berry, a converted Leaver, has said businesses in the north “see a real opportunity in Brexit” and are braver than many politicians and civil servants.

Financial Times Yorkshire Post, Page: 4

CORPORATE NEWS

Debenhams appoints new CFO

Debenhams has revealed that it has appointed Rachel Osborne as its new CFO, effective September 17th. Ms Osborne, formerly Domino’s Pizza finance chief and a John Lewis executive, succeeds Matt Smith, who is leaving at the end of August to join Selfridges. Osborne will join on a salary of £439,000 a year, plus the potential to bag up to £878,000 in bonuses.

Financial Times, Page: 17 City AM The Times, Page: 41 The Daily Telegraph, Page: 31 The Sun, Page: 47 The Independent, Page: 63 Daily Express, Page: 46 Daily Mirror, Page: 49

Union calls for Carillion enquiry

The Unite union has called for a public inquiry into the collapse of Carillion. Unite said the probe should cover the Government’s approach to the awarding of contracts to the firm, despite there being fears over its stability. Assistant general secretary Gail Cartmail said: “There is a growing concern that the Government’s inaction could result in further collapses of outsourcing giants, resulting yet again in workers losing their jobs and the taxpayer picking up the tab.”

The Times, Page: 46 Daily Mirror, Page: 57

Rosenblatt CFO resigns

City law firm Rosenblatt, which listed in May for £42m, is to lose finance director Patrick Firebrace just eight months after he joined.

City AM, Page: 6 The Times, Page: 45

 

PENSIONS NEWS

Two out of five self-employed have no pension

A study by Prudential has found that 43% of Britain’s 4.8m self-employed are failing to pay into a private pension. Nearly one in three says they will rely solely on the state pension, while 28% say they will expect their business to provide the income they need.

Daily Express, Page: 23 Daily Mirror, Page: 14

ECONOMY NEWS

Scotland’s deficit four times higher than rest of UK

Scotland’s fiscal deficit was £13.4bn in the 2017-18 financial year, down £1bn compared with the previous year. However, this represents 7.9% of GDP, compared with the 1.9% recorded for the UK as a whole. The Times points out that this is more than double the limit allowed by the European Union for independent member states. Tax revenue per person was £306 lower in Scotland than the UK average, while total public expenditure was £1,576 higher. Murdo Fraser, the Scottish Conservative party’s finance spokesman, commented: “If Nicola Sturgeon wants to continue her threat of second referendum, she has to come out and explain where she would find £13bn to fill this deficit.”

The Times, Page: 2 The Times Daily Mail, Page: 21 The Guardian, Page: 31 Financial Times, Page: 2 The Scotsman, Page: 1, 7

Axing 1p and 2p coins would not push up inflation

In a blog post, the Bank of England has claimed that scrapping 1p and 2p coins would not push up inflation. Two analysts from the Bank said their research and the “overwhelming weight of literature and experience” suggests that retiring 1p and 2p coins would have “no significant impact on prices”. The analysts also highlighted that price tags ending in 99p now only account for 12% of prices. This means rounding up would be less of an issue if 1p and 2p coins were ditched, they said.

BBC News The Times, Page: 2 Daily Mail

Rise in personal insolvencies predicted

Personal insolvencies in Britain are expected to exceed 100,000 by 2022, according to debt collector Arrow Global. The ONS said the average family spent £900 more than they earned last year – the first time in 30 years households collectively spent more than they had brought in.

The Times, Page: 38

Business fears a Corbyn government almost as much as Brexit

Research by BritainThinks reveals a Corbyn government is perceived by business leaders to be the second biggest threat after Brexit. High taxes and productivity were seen as the next greatest challenges.

Financial Times, Page: 1

Chancellor warns of higher borrowing costs after no-deal

In a letter to the Treasury Committee, published just after the government’s Brexit documents were released, Chancellor Philip Hammond reiterated a warning from his department of a 7.7% hit to GDP under a no-deal Brexit scenario. He claimed that borrowing would also increase by £80bn a year by 2033. The letter is understood to have been published without Downing Street’s clearance, and a spokesperson for No 10 said that the analysis highlighted by the Chancellor was “preliminary and very much a work in progress.”

The Daily Telegraph The Times, Page: 1 The Guardian, Page: 8 The Independent, Page: 62

OTHER NEWS

Katie Price’s full debts revealed

Reality TV star Katie Price reportedly owes almost half a million pounds to the tax office and other creditors and has until October 30th to come up with an individual voluntary agreement to settle her debts.

The Mirror

Aretha died intestate

US website TMZ has reported that Aretha Franklin, who died last week aged 76, had an estate worth $80m, but did not leave a will detailing the distribution of her fortune. Michigan law dictates that, in such an event, an individual’s fortune is to be shared equally among their children – in Ms Franklin’s case, four sons.

The Daily Telegraph

Tax sweetener could tempt Britons to Italy

The Italian government is considering a proposal to lure pensioners to poorer and depopulated areas of southern Italy with the offer of a ten-year tax holiday. The idea would initially apply to Calabria, Sicily and Sardinia, which offer few economic opportunities to their dwindling inhabitants.

The Times, Page: 15

Contact Paul Southward if you have any queries.

Paul Southward


Updated Key Guides published 23rd August 2018


Updated Key Guides published 23rd August 2018

UPDATED KEY GUIDES

Whilst most of us bask in the hottest summer for over half a century, the government is busy running consultations and trying to prepare for what Brexit will eventually mean. But that is no reason for us not to be busy, whilst we await the announcements of the Budget, and the result of the negotiations.

The latest update for our Key Guides series brings you fully revised guides giving you essential explanations of key topics across business, tax and retirement planning. We understand how confusing it can be to get a clear understanding of how complex rules and reliefs affect you, so our guides will give you everything you need to get started in one place.

Our current update includes new examples, tables, graphics and case studies throughout, to make each topic as accessible and easy to get to grips with as possible. The new range will give you real world examples of complex rules and calculations, including fresh advice on inheritance planning and gifts.

Investing tax-efficiently

  •  New example on timing of CGT gains and losses
  •  Added reference to the OTS review of savings and investment income tax

 Making Tax Digital

  • Updates on latest timetable announcements from HMRC
  • Updated section on MTD pilot schemes
  • Restructured to focus on VAT and preparing for MTD

Pensions tax planning for high earners

  • New clarification and example on tax on pension withdrawals
  • New example on SIPP borrowing for property investment
  • Clarification on income tax relief on contributions in Scotland

Starting and selling a business

  • New tables covering:
  • Business financing options
  • Advantages and disadvantages to limited company structure
  • Payment options on sale of a business
  • Loan notes
  • VAT treatment of going concerns

Strategies for a high-tax environment

  • New example highlighting differing CGT rates between residential property and other assets
  • New graphic on maximum tax-free income allowances
  • Updated OBR forecasts

Working through personal service companies

  • New table summarising tax deadlines for deemed salary under IR35 rules
  • Restructuring of ‘Tax planning and pitfalls’ section
  • Summaries of recent IR35 rulings
  • New section on consultation on IR35 rules in the private sector

Estate planning

  • New example on the application of lifetime gifts and gifts from normal income

The latest Key Guides can be downloaded here:-

Tax Planning for High Earners

Tax Planning for High Earners

Estate Planning

Estate Planning

Making the most of Fringe Benefits

Making the most of Fringe Benefits

Strategies for a High Tax Environment

Strategies for a High Tax Environment

Investing Tax Efficiently

Investing Tax Efficiently

Making Tax Digital

Making Tax Digital

Personal Service Companies

Personal Service Companies

Starting and Selling a Business

Starting and Selling a Business

For more information contact Paul Southward or your usual KSK contact.

Paul Southward