NEWS – FRIDAY 28TH AUGUST 2020
NEWS – FRIDAY 28TH AUGUST 2020
TAX NEWS – FRIDAY 28TH AUGUST 2020
Celebs who channel earnings into companies could face tax crackdown
The Mirror suggests TV stars who pay their earnings into companies and take dividends to avoid the higher rate on income tax could be targeted by HMRC. The paper cites Mel Stride, chairman of the Treasury Select Committee, who said last month that there had been a marked increase in the number of people “operating on their own, through their own company, as opposed to, for example, the numbers that are operating through their own company and employing others.” Mr Stride argued that, “all that is fairly suggestive of this being done largely for reasons of tax benefits.”
Lockdown will not exempt foreign citizens from paying tax, says Spain
Spanish authorities have said that extended stays in the country due to coronavirus lockdowns would not excuse foreign citizens from having to pay tax in Spain. The finance ministry ruled that no exceptions would be made to the rule under which spending 183 days of a year in the country automatically makes foreigners tax residents. The statement came in response to a query by a Lebanese family who had spent longer than expected in Spain.
HMRC ADVISORY FUEL RATES UPDATED FROM 1ST SEPTEMBER 2020
HMRC have published company car advisory fuel rates for use from 1 September 2020.
The rates apply when employers reimburse employees for the cost of fuel for business travel in their company cars or require employees to repay the cost of fuel used for private travel. HMRC review rates quarterly on 1 March, 1 June, 1 September and 1 December. See the new rates here:
EMPLOYMENT NEWS – FRIDAY 28TH AUGUST 2020
Media blitz will urge people to return to the office
Boris Johnson will launch a campaign next week designed to persuade people to get back to the office amid fears working from home leaves workers vulnerable to being sacked. The messaging will promote the mental health benefits of working with colleagues, provide reassurance that “the workplace is a safe place”, and warn that bosses will find it easier to fire people they never see than colleagues who have been at their desks during the pandemic. The move comes as the Chancellor worries about the knock-on effect of office workers staying out of towns, with sandwich shops, gyms and pubs all threatened by the lack of footfall. Frances O’Grady, general secretary of the TUC, said the Prime Minister must do more to give people confidence it is safe to return: “We need to have a fast and reliable test and trace system and we need better enforcement of transport safety and workplace risk assessments.”
INDUSTRY NEWS – FRIDAY 28TH AUGUST 2020
CIOT agrees all advisers should be professionally qualified
The Chartered Institute of Taxation (CIOT) has welcomed a proposal from the Government to require anyone who wants to provide tax advice on a commercial basis to belong to a recognised professional body. The Institute said an alternative proposal for a new government regulator of tax advisers would be costly and ineffective. John Cullinane, CIOT Tax Policy Director, suggested a transition period before changing the law to prevent disruption, but added: “HMRC acknowledge that most behavioural problems they encounter by tax advisers are not by members of professional bodies. We call on HMRC to publish far more of its data on tax advisers because we know very little about the population of advisers outside professional bodies. We understand from HMRC that they represent 30% of tax agents but are responsible for most behavioural issues they encounter.”
CORPORATE NEWS – FRIDAY 28TH AUGUST 2020
Rolls-Royce in trouble after posting £5.4bn loss
Rolls-Royce swung to a £5.4bn loss in the first-half after taking a battering from the COVID-19 pandemic. In the six months to June 30, revenue fell 26% to £5.8bn resulting in a post-tax loss of £5.4bn and an underlying post-tax loss of £3.3bn. Rolls-Royce also said finance boss Stephen Daintith had resigned to move to retail technology firm Ocado. Julie Palmer, a partner at Begbies Traynor, commented: “With its reputation currently diminishing, shareholders starting to bail out and the full force of Covid headwinds yet to come, [CEO Warren East] still has a lot of work to do to make sure Rolls-Royce can ride out the storm.”
FIRMS NEWS – FRIDAY 28TH AUGUST 2020
FRP Advisory announces 16% rise in revenue
The Aim listed corporate restructuring specialist FRP Advisory has announced a 16% rise in annual revenue and it first dividend. The firm said an increase in administration appointments had helped to increase its revenue to £63.2m for the year to the end of April. Adjusted annual profit increased by 31.7% to £18.7m and the group announced a maiden dividend of 0.66p a share. CEO Geoff Rowley said: “With a significant and growing market share, FRP is well placed to service increasing levels of restructuring assignments in the UK, both on increasingly high-profile, complex cases and across regional businesses through our national network.”
PROPERTY NEWS – FRIDAY 28TH AUGUST 2020
Buy-to-let purchase activity bounces back
Mortgage brokers have reported a surge in buy-to-let mortgage activity as property investors look to take advantage of the current stamp duty break. A survey carried out by mortgage adviser forum Cherry found an increase in demand from both individuals and those buying via a limited company. More than 30% of brokers reported an increase in individual purchases and almost 27% said they had arranged more deals for limited companies acquiring buy-to-let properties. According to the study, purchase activity is leading the way in terms of buy-to-let enquiries, with 57% of brokers seeing an increase in acquisitions, compared to less than 12% who reported more demand for capital raising on a remortgage.
SMEs NEWS – FRIDAY 28TH AUGUST 2020
Regulating advisers will reduce R&D tax relief abuse
Scott Henderson, CEO of ABGI-UK, calls in Accountancy Daily for standards to be raised in the advice market to reduce the volume of R&D tax relief fraud. HMRC has identified and prevented over £300m fraudulent claim attempts through the SME R&D tax relief scheme alone and is conducting a consultation on preventing the abuse of this relief.
PERSONAL FINANCE NEWS – FRIDAY 28TH AUGUST 2020
Platform fees tipped to drop further
The Lang Cat predicts the average market cost of platform fees will drop by just above a basis point per year for the next five years. Figures from the research and consultancy firm show the average cost of holding £500,000 on a platform is currently 0.27% and is expected to fall to about 0.21% by 2025.
ECONOMY NEWS – FRIDAY 28TH AUGUST 2020
Optimism rises ahead of expected jobs cull
British business confidence in the UK has improved, according to Lloyds Bank’s business barometer, which is up eight points to -14, the biggest monthly increase in three years. Hann-Ju Ho, a Lloyds Bank economist, said: “it is encouraging to see gradual improvements in trading prospects and economic optimism, albeit from a low base.” However, with unemployment expected to rise as the furlough scheme comes to an end, analysts say the bounce-back could prove short-lived. According to Lloyds, only 18% of businesses with staff still on furlough expected to be able to retain all of them.
The Times, Page: 43 Reuters
OTHER NEWS – FRIDAY 28TH AUGUST 2020
Uber employees sue over stock price decline
Uber is being sued by nearly 200 current and former employees who claim the company made a “risky” bet after its IPO which left them with millions of dollars in added tax liabilities.
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