News Roundup Thursday 12th July 2018

NEWS ROUNDUP

TAX NEWS

HMRC maintains MOO view

HMRC has been criticised for failing to change its view on a key area of important case law it omitted from its Check Employment Status for Tax (CEST). Concerns were first raised about HMRC’s omission of mutuality of obligation (MOO) within CEST over a year ago. After considerable pressure from stakeholders, HMRC provided its feedback in a draft whitepaper on MOO to IR35 Forum Members in March 2018. Many Forum Members refuted HMRC’s arguments, but the Revenue has now published its official legal stance on MOO and dismissed the views of the forum.

Contractor Calculator

Savers baffled by Isa rules

Bereaved savers are struggling to understand complex rules on how much of their partner’s Isa allowance they can inherit. New rules introduced in April mean the amount depends on when a partner died. If they died between December 4, 2014, when the ‘Additional Permitted Subscription’ was first introduced, and April 5 this year, their Isas lose their tax-free status from the date of death. This means any interest paid while the estate is being wound up is taxable.

Daily Mail, Page: 44

Contractors’ group urges HMRC to set up suicide helpline

A group representing contractors and freelance workers in the UK are calling on HMRC to set up a 24-hour Suicide Hotline to deal with calls from people reporting suicidal thoughts as a result of the 2019 Loan Charge. Nurses, doctors, teachers, social workers, IT and oil & gas contractors are among those facing retrospective tax bills running into hundreds of thousands of pounds after they were mis-sold employment arrangements by employers and agencies. A spokesperson from volunteer support organisation, the Loan Charge Action Group, commented: “HMRC must accept responsibility for their implementing this policy and the consequences of doing so. The ‘vulnerable customer policy’ is not sufficient nor will it prevent mental breakdown or suicides, so they must set up a hotline and deal with the consequences of this policy.”

Business Matters

SMEs NEWS 

Entrepreneurs penalised by business rates

The Mail’s James Burton warns that thousands of entrepreneurs are facing huge increases in business rates because they have done up dilapidated high street properties – increasing both the value of the property and the business rates applied to it. Kate Nicholls, of trade body UK Hospitality, comments: “When businesses invest to give communities vital services like pubs, hotels and restaurants they take a huge financial hit as the tax take is hiked. Business rates are nothing short of a tax on success and a disincentive on entrepreneurship.”

Daily Mail, Page: 19

SMEs hold off on hiring and investment

Brexit-related anxieties are leading to more companies delaying decisions on hiring and investment. Three in ten SMEs postponed plans in the second quarter of the year because of uncertainties around Britain’s exit from the EU, according to a poll by Capital Economics. This was up from the one in four who delayed decisions due to Brexit in every other quarter since the referendum. There was a more pronounced effect among small companies that export to the EU, with more than four in ten shelving plans due to Brexit.

The Times, Page: 38

One in six firms face business rate summons

Research by Altus Group has found that nearly a sixth of companies that pay business rates have faced the threat of court action over arrears. A year after the contentious revaluation of business rates, it has been estimated that about 190,000 companies received a summons to appear before magistrates over unpaid bills. Altus Group said this meant that 15.2% of businesses that received rates demands had been pursued over unpaid tax debts.

The Times, Page: 38

Tax probes ‘too intensive’, say SMEs

More than half of SMEs think HMRC’s tax investigations are too intensive, according to new research. PfP found that 52% of small businesses find the tax probes too rigorous, while 56% do not think HMRC attempts to minimise the cost, time and effort involved in dealing with the investigations.

Economia

Is crypto going mainstream?

The Fin ancial Conduct Authority has granted fintechs experimenting with crypto assets access to its sandbox for the first time. Some 40% of 29 entrants are using distributed ledger technology.

Financial Times

CORPORATE NEWS

Denison steps down from Yorkshire CCC

Yorkshire County Cricket Club (YCCC) chairman Steve Denison has announced his resignation from the board. The former PwC partner was last month fined by the Financial Reporting Council and signed an undertaking not to take part in any audit work for 15 years for his role in the 2014 audit of BHS.

The Daily Telegraph, Sport, Page: 9 The Times, Page: 58

Former Deloitte chair poised for Sainsbury’s role

Former Deloitte chairman Martin Scicluna is set to become chairman of J Sainsbury’s. The grocer could announce the appointment at its annual meeting today.

The Daily Telegraph, Business, Page: 7 The Times, Page: 35

Outsourcing approach ‘flawed’, say MPs

The government is prioritising cost over quality when outsourcing public sector contracts, leading to worse services, a committee of MPs says. The collapse of Carillion had exposed “fundamental flaws” in the outsourcing process, the Commons Public Administration and Constitutional Affairs Committee said. It found the government’s approach of “spending as little money as possible” meant that contractors were being forced to “take unacceptable levels of financial risk”.

BBC News

PROPERTY NEWS

Ministers examine renting rules

Airbnb hosts have been warned they could lose a valuable tax break if they do not live in the property they let out. The Rent a Room scheme currently allows homeowners to earn up to £7,500 by letting out rooms in their home tax-free, but ministers have proposed a residency test that could come into force next spring.

Daily Mail, Page: 43

ECONOMY NEWS

Infrastructure spending could boost economy by £33bn

A report commissioned by the mayor of London predicts the government could bring in £9.8bn in additional tax take per year if it increased spending on national infrastructure projects. The research, carried out by Greenwood Strategic Advisors, concludes that increased investment would add £33.8bn to the economy each year.

The Independent, Page: 63

World Cup win for retailers

Britain’s retailers have been helped by England’s World Cup run and the warm weather. A report from the British Retail Consortium and KPMG shows retail spending rose by 2.3% in June compared with the same month last year, after receiving a boost from “beers, barbeques and big TVs”.

The Guardian, Page: 29 The Times, Page: 36-37

OTHER NEWS

Accountant caught up in crooked GP fraud case

A GP attempted to con an esteemed elderly French woman out of her £1.5m London home, a court has heard. Ninety-six-year-old Armande Cohen’s accountant Barry Jefferd, a partner at George Hay in Cambridgeshire, who denies a count of forgery, drew up a will, allegedly signed by Mrs Cohen, in which she was to leave her Cadogan Square flat and its contents to Dr Oliver Reymond.

The Daily Telegraph, Page: 11 The Times, Page: 17 Daily Express, Page: 8 Daily Mail, Page: 28

Clydesdale introduces mortgages for accountants

Clydesdale Bank Intermediaries has introduced a mortgage specifically aimed at those who have qualified as accountants, within the last five years, with an income of £40,000 or more. Among the features are income multiples of up to 5.5x income, up to 95% LTV for first-time buyers or home movers and a maximum loan size of £600,000.

Mortgage Strategy

Aspiring accountant’s CV gamble pays off

An accounting student has been offered a job after handing out his CV to commuters at London train stations. Kamran Hussain, 21, stood with a sign reading “ Aspiring accountant. Looking for entry level job. Ask for CV”, and the next day accepted a job offer from a marketing firm.

Metro

YouTubers expect to earn twice as much as investment bankers

Students who plan to make social media their career expect to make twice as much as aspiring bankers in their first year of work. A survey of students by discount site UNiDAYS found that YouTubers are confident of earning £55,000 in their first year on the job, while those wanting to enter the investment banking sector expect to earn just £26,400 in their first year. The expected starting salary for a career in accountancy is £23,600.

City AM

Contact Paul Southward if you have any queries.

Paul Southward