News Roundup Friday 5th April 2019
News Roundup Friday 5th April 2019
Customers face tax bills on mis-sold Isas
People who held mini-bonds with collapsed firm London Capital & Finance (LC&F) may have to pay tax on the failed investments, with HMRC saying Isa accounts dating back to April 2017 are void. Although LC&F was approved by HMRC as an official Isa manager and its bonds advertised as Isa-eligible, the mini – bonds it sold were not Isa-compliant. The Revenue has thus declared that income tax must be paid on any interest earned over and above individual tax allowances. This comes despite requests for leniency from joint administrators Smith & Williamson. HMRC says it is not pursuing investors aggressively or retrospectively and is sympathetic to the position they find themselves in. Meanwhile, the Daily Mail’s James Burton says EY apparently missed suspicious trades at LC&F before it went bust, giving its accounts a clean bill of health. EY signed off on LC&F’s accounts for the year to 2017, while its books were checked by PwC the year before, with both firms saying LC&F was keeping accurate records and following rules. Mr Burton says the revelations “pile fresh pressure on the audit profession”.
HMRC urges loan scheme users to come forward
HMRC is encouraging users of disguised remuneration (DR) schemes to settle their tax debt by 5 April, with the majority of those who used DR schemes likely to pay less by settling now rather than waiting until the loan charge comes into force. Those earning less than £50,000 and no longer involved in tax avoidance can spread their payments over five years minimum while anyone earning less than £30,000 can spread payments over a minimum of seven years. Meanwhile, MPs on the loan charge all-party parliamentary group have branded the loan charge a “cynical attempt by HMRC to cover up past failures” and called for it to be delayed and an independent review conducted.
Press Release Financial Times, Page: 2 Yorkshire Post, Business, Page: 1
Taxman targets image rights payments
HMRC is targeting football clubs and players for what it considers to be unpaid tax related to image-rights payments, with tax consultant Andy Wood suggesting a ruling in favour of the taxman in a case involving Hull City could see new laws introduced.
I, Page: 51
The new tax year starts on 6th April and we have reviewed the tax changes that come into effect this April and you can check these out in the downloads below..
Personal tax changes
Business tax changes
Google’s tax bill hits £66m
Google UK reported a corporation tax bill of £66m for last year, up on the £47m it paid the previous year. The firm reported a 10% rise in UK revenues to £1.4bn, with pre-tax profit up to £246m. The figures do not include Google’s advertising revenues – which make up the lion’s share of its income. City AM, which says tech firms have faced criticism for paying low levels of tax in the UK, notes that Google’s tax figures are significantly higher than those at Amazon, which handed HMRC just over £4.5m last year. Paul Monaghan, of campaign group Fair Tax Mark, commented: “The accounts make little or no effort to shed light on whether Google is paying a fair amount of tax on UK earnings, in all likelihood because it is not.”
The Daily Telegraph, Business, Page: 5 Daily Mail, Page: 21 The Sun, Page: 2 Daily Mirror, Page: 7 City AM
Bolton score court delay
Bolton Wanderers have been granted a further stay of execution by the High Court as the club look to avoid a winding-up order over an unpaid £1.2m tax bill. The football club’s case has been adjourned until May 8 to allow a proposed sale of the club to proceed.
The Independent The Times, Page: 69 The Daily Telegraph I, Page: 54 The Sun, Page: 53
Wageday victims may miss out
People mis-sold payday loans by Wageday Advance are set to be emailed details on how to claim compensation, with KPMG, the lender’s administrators, saying there would be insufficient funds to pay everyone what they were owed. “Creditors with valid claims will only receive a partial payment,” the firm warned.
The Times, Page: 40
Freshfields sued over role in German bank’s tax scandal
The liquidator of failed lender Maple Bank is suing law firm Freshfields Bruckhaus Deringer for €95m in relation to share-swapping schemes that allegedly allowed investors to reclaim tax they never paid.
Market primed for sales surge?
A report from estate agent Savills suggests that despite political uncertainty and fragile consumer sentiment, the prime housing market held up “better than expected” in the first quarter of 2019. The firm said a build-up of buyer demand in the market could trigger increased sales when there is more certainty over Brexit, noting that while the first quarter saw new buyer registrations for properties over £1m up 36% in central London and 11% across the rest of the capital, this has not yet translated into increased market activity.
I, Page: 40 Daily Mail
Brexit stunts services growth
Growth stalled in the first three months of 2019 as the services sector contracted in March for the first time in two-and-a-half years. The purchasing managers’ index from IHS Markit/CIPS fell to 48.9 in March from 51.3 in February, below forecasts. It is the first time the index has fallen below 50 since July 2016, immediately after the UK voted to leave the European Union.
Poker champ no longer flush
Poker champion Adam Lulat has been stripped of £30,200 in tournament prize-money to repay cash he stole in a tax fraud. This marks the second time that Mr Lulat has had to hand winnings over after he was jailed for 28 months in 2015 for his involvement in a money laundering scam and VAT fraud. The conviction, which followed an HMRC investigation, saw him ordered to repay £68,930 in August 2018.
Contact Paul Southward