NEWS – MONDAY 25TH JANUARY 2021

NEWS ROUNDUP

TAX NEWS – MONDAY 25TH JANUARY 2021

Green investments should earn firms tax breaks

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

The Daily Telegraph, Business, Page: 3

Doctors fighting Covid refuse extra shifts due to tax penalties

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

The Daily Telegraph

Taxpayers told to query deadline fines

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

The I, Page: 45 Daily Express

It is not the time for Britain to raise taxes

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

Financial Times, Page: 22

EMPLOYMENT NEWS – MONDAY 25TH JANUARY 2021

Calls for work placement programme to be extended

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

The Daily Telegraph Financial Times Financial Times, Page: 2

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

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

Financial Times

PROPERTY NEWS – MONDAY 25TH JANUARY 2021

Foreign demand remains for prime sites in the capital

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

The Daily Telegraph

INVESTMENT NEWS – MONDAY 25TH JANUARY 2021

Bank of England warned over climate change investments

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

Financial Times The Independent Daily Express

INDUSTRY NEWS – MONDAY 25TH JANUARY 2021

Tech frees finance chiefs for broader roles

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

Financial Times, Corporate Change and Technology

CORPORATE NEWS – MONDAY 25TH JANUARY 2021

Boohoo set to acquire Debenhams brand

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

Financial Times

ECONOMY NEWS – MONDAY 25TH JANUARY 2021

Record redundancies planned last year

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

BBC News

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

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

Financial Times

Contact Paul Southward

Paul Southward