NEWS – FRIDAY 12TH JUNE 2020

NEWS ROUNDUP

TAX NEWS – FRIDAY 12TH JUNE 2020

SEISS claimants ‘could face significant tax bills’

Self-employed grant claimants may have to consider income tax bills for Self-Employment Income Support Scheme (SEISS) payments, with the government currently working on draft legislation which could see new rules on taxing coronavirus business support grants introduced. Victoria Todd, head of the Low Incomes Tax Reform Group (LITRG), remarked: “Many claimants of SEISS grants might, understandably, use the money as soon as they get it, for example, to catch up on liabilities or to meet essential living costs – but they need to think now about budgeting for income tax and National Insurance on it.” She went on: “We urge HMRC to do as much as they can to publicise that the grants are chargeable to income tax and National Insurance, to reduce the risk of people being surprised by higher-than-expected 2020/21 tax bills.”

Daily Express

Is IHT exemption for Aim-quoted shares under threat?

The Telegraph’s Questor column considers whether the drastic impact on public finances from the coronavirus pandemic could lead to the loss of the inheritance tax break on Aim shares. The paper’s Richard Evans says experts have pointed to the relief as a possible target as it would be much more attractive that raising VAT or income tax. Kelly Greig, a specialist in inheritance planning at Irwin Mitchell, says: “People are already feeling the pinch but changing inheritance tax reliefs wouldn’t affect that many people, it wouldn’t affect the disadvantaged, so there wouldn’t be a public outcry.”

The Daily Telegraph, Business, Page: 6

EMPLOYMENT NEWS – FRIDAY 12TH JUNE 2020

Ministers braced for a wave of job cuts in the UK

Ministers fear a wave of job losses as large companies hit by the coronavirus crisis start to prepare redundancy notices. The FT notes that Monday is the last day when companies cutting more than 100 jobs could start redundancy consultations if they want to avoid incurring at least some of the cost of furloughed staff from August. Concerns are rising as Centrica announces 5,000 job cuts and Johnson Mathey, Heathrow Airport and Liberty Steel line up redundancies. Meanwhile, the Fawcett Society claims COVID-19 could set back efforts to get more mothers into the workplace by 20 years. CEO Sam Smethers said women are “easy to get rid of because they are on zero-hours or minimum-hours contracts”. The charity also said with more mothers having to give up work thousands of child care worker could face redundancy. The Express notes figures from PwC showing 78% of those who have lost their jobs due to the coronavirus are wom en.

Financial Times, Page: 2 The Daily Telegraph Daily Express, Page: 8

HMRC prepares to crack down on furlough abuse

In a piece on the cost of the government’s job retention scheme, the Times notes that a consultation on new powers in the Finance Bill to enable HMRC to go after those abusing the scheme ends today. Over 2,000 reports of misuse of the furlough scheme have already been reported to HMRC. Dawn Register, partner in tax dispute resolution at BDO, said: “It is clear that HMRC is now gearing up to tackle incorrect and fraudulent claims for COVID-19 support payments.”

The Times, Page: 36

FINANCE NEWS – FRIDAY 12TH JUNE 2020

BGF wants investors to support recovery fund

Stephen Welton, chief executive of the Business Growth Fund, is launching a new £15bn fund to support businesses reeling from the COVID-19 crisis. Mr Welton is hoping to persuade pension funds, insurers and sovereign wealth funds to contribute cash which will be matched by the government. This National Renewal Fund is likely to focus on companies providing essential supplies to the nation, such as manufacturers of personal protective equipment. He hopes the fund will be up and running by autumn to so it can step in when the furlough scheme ends.

The Daily Telegraph

CORPORATE NEWS – FRIDAY 12TH JUNE 2020

Morrisons hires KPMG for governance review

KPMG has been appointed by Morrisons to review the retailer’s corporate governance following the resignation of two non-executive directors in March. There were reports that the two directors had raised corporate governance complaints when they resigned, in particular in relation to chairman Andrew Higginson’s perceived closeness to David Potts and Trevor Strain, the chief executive and chief operating officers respectively.

The Daily Telegraph, Business, Page: 4

Intu’s creditors asked for extra £12m funding

With shopping centre owner Intu Properties facing a possible administration, advisers from KPMG have asked for up to £12m in additional funding in order that Intu can continue running some of the centres should it fall into administration. A source said the request was designed to “focus minds” as I lenders decide whether or not to grant an 18-month standstill on Intu’s £4.5bn debt mountain.

Sky News

SMEs NEWS – FRIDAY 12TH JUNE 2020

Advisory experts back P2P lending sector to become mainstream investment class

Advisory experts have backed the peer-to-peer lending sector to become a mainstream investment class after COVID-19. Mark Turner, managing director, regulatory consulting at Duff & Phelps, said the pandemic presents an opportunity for the sector to prove itself. “I think there is the opportunity for P2P lending to be seen as a mature, mainstream asset class and especially if it can prove itself through this crisis as a sector that can manage risks effectively and generate good returns for investors, then I think the sector could really come of age,” he said. Similarly, Frank Wessely, partner at Quantuma, said that the P2P lending sector will be able to demonstrate it is a much more robust and secure asset class once it emerges from this pandemic, as long as there no further platform failures.

P2P Finance News

PERSONAL FINANCE NEWS – FRIDAY 12TH JUNE 2020

ONS figures reveal lockdown savings for UK households

Research by the Office for National Statistics (ONS) has found that during the financial year ending March 2019, UK households spent a weekly average of £182 on activities that they have largely been unable to pursue in recent months due to coronavirus restrictions. This equates to 22% of a usual weekly budget of £831 which has been saved in each household since lockdown was implemented.

Evening Standard

ECONOMY

IoD survey reveals reduced investment intentions

The latest business survey by the Institute of Directors (IoD) reveals the COVID-19 crisis had driven down investment intentions by 11% among its members to a record low of -43%. Confidence in the economy overall rose slightly from -69% in April to -60%.Tej Parikh, the IoD’s chief economist, commented: “The government must pull out the stops this summer. If it holds back too much ammo for later in the year, firms’ recoveries will be slowed.” Separately, the IoD has also warned that half its member companies will be unable to trade if the two-metre social distancing rule remains in place.

The Guardian Daily Mail, Page: 16

Contact Paul Southward