News Roundup Tuesday 3rd September 2019

NEWS ROUNDUP

TAX NEWS

Self-employed owe £1.6bn in late tax

Data from HMRC shows that the self-employed owe £1.6bn in late tax payments for the 2017/18 tax year, with the total likely to surpass the previous year’s record of £1.83bn as many returns have still not been filed. UHY Hacker Young’s Neela Chauhan said that while the “vast majority” of taxpayers fully intend to pay on time, “they face a lose-lose scenario when they find it hard to do so. They could either choose to pay the full amount on time, risking the long-term health of their business or career because of the hit on their cash flow, or accept a potentially hefty fine further down the line.” With figures showing that there were a record 4.93m self-employed people in March, Ms Chauhan said: “As the number of self-employed people continues to rise, the money owed through late payments is also likely to mount.” She added that with it suggested that HMRC is becoming “increasingly a ggressive” when chasing debts, taxpayers would like the taxman to be “more flexible and give them a bit of leeway when managing payments.”

Daily Express, Page: 2 I, Page: 40 Financial Times, Page: 2

MPs call for APD cut

The All-Party Parliamentary Group for Air Passenger Duty Reform has urged the Government to cut or scrap the UK’s airline taxes, saying the levy is highest tax of its kind in Europe. They say that even if the charge – which adds £13 to the cost of short-haul tickets and £78 for long-haul flights in economy and £176 for those in first or business class – is halved, it would still be the highest in Europe. The Government is expected to raise £3.7bn in Air Passenger Duty this year, equivalent to 0.5% of total tax receipts. Meanwhile, the chief executives of Easyjet, Ryanair and British Airways’ parent company IAG are among those who have signed a letter to the Chancellor warning that the tax is “holding back UK connectivity”.

The Daily Telegraph, Business, Page: 3 The Independent, Page: 51 Daily Express, Page: 49 Yorkshire Post, Page: 4

INDUSTRY NEWS

FTSE 100 firms more evenly spread

FTSE 100 clients are now more evenly spread out among the Big Four than at any time in almost 15 years, according to a report from Adviser Rankings. The analysis shows that PwC and KPMG both shed FTSE 100 clients in the last quarter, with EY the main beneficiary. City AM says that with FTSE 100 and FTSE 250 firms required to conduct an audit tender at least every 10 years and rotate auditors every 20 years, the majority of tenders have led to a change in auditor over recent years.

City AM, Page: 10

SMEs NEWS

Bank referral scheme helps fewer than 800 firms

The bank referral scheme, a Treasury initiative which links small companies turned down for bank finance with alternative lenders, is helping fewer than 800 companies a year. Figures from the Treasury show that the programme led to 796 companies being lent £16m in the 12 months to June 30. The data shows that fewer than 1,700 businesses have been assisted – to the tune of a combined £32m – since the scheme was launched in November 2016, with around one in twenty companies referred via the scheme securing finance. The Federation of Small Businesses said that the results were “underwhelming”, with national chairman Mike Cherry saying that the figures equated to “helping well under 1% of the small business community secure a few million over three years” – adding that this “doesn’t scream roaring success.”

The Times, Page: 41

PROPERTY NEWS

Firms face £662m rates rise

Calculations by real estate adviser Altus Group show that businesses are likely to have their business rates increased by 2.1% in line with the expected September inflation rate, which would result in a total increase of £662.15m. Considering the hit firms could take from higher bills, Altus Group’s head of UK business rates, Robert Hayton, commented: “I urge the Chancellor to take the bold and ambitious step of being the first Chancellor to freeze the multiplier since the national business rates system was introduced in 1990.”

Daily Express, Page: 49 I, Page: 38 Yorkshire Post, Page: 15

CORPORATE NEWS

Secret Escapes names CFO

Travel website Secret Escapes, which is said to be mulling a stock market listing or sale, has hired its first CFO, with former Zoopla finance chief Andy Botha taking on the role.

The Daily Telegraph, Business, Page: 3

Firm acquired

Education recruitment agency PK Education has been acquired by Einstein Recruitment in a pre-pack administration deal after Kris Wigfield and Joanne Hammond of Begbies Traynor were appointed as joint administrators.

Yorkshire Post, Page: 15

FINANCIAL SERVICES NEWS

Impact investing deal sets stage for more

The FT says impact investing seems the “logical next step” for asset managers who have integrated ESG considerations, carrying comment from KPMG’s Troy Mortimer and Ben Phillips of Deloitte consultancy Casey Quirk.

Financial Times

WEALTH MANAGEMENT NEWS

Fund management chiefs hit by big pay cuts in 2018

Analysis of annual reports from US and European fund managers shows that 18 CEOs saw pay cuts in 2018, with PwC’s Tim Wright saying productivity measures “contributed to downward pressure” on pay.

Financial Times, FT Fm, Page: 6

PERSONAL FINANCE NEWS

Only 3.7% apply for Help to Save

HMRC figures show that only one in 27 of those eligible for the Help to Save scheme have so far applied in the 12 months since its launch. While 100,000 people have made a deposit into the Help to Save scheme, 32,000 who have opened an account have yet to pay any money in. Total deposits into the scheme in the six months to July were £18m. The initiative offers bonuses to the 3.5m people entitled to working tax credit or receiving universal credit, with up to 50p received for every £1 saved, up to a maximum of £1,200 over four years. Kate Smith, head of pensions at Aegon, said that the Government would be disappointed with the take-up so far, noting: “It is just 3.7% of those eligible to take part.”

The Times, Page: 39

ECONOMY NEWS

Chancellor set for spending round statement

Richard Partington in the Guardian looks ahead to Chancellor Sajid Javid’s spending round statement on Wednesday and the need for a long-term economic plan. He cites Yael Selfin, chief economist at KPMG, who comments: “It would not make sense to rush any additional spending at this stage. It makes sense to be prudent and say ‘I’m going to hold back to leave a bit of margin for Brexit.”

The Guardian, Page: 35

OTHER NEWS

Law firms see benefits of incorporated model

Law firms are ditching the traditional partnership structure in favour of the incorporated business model. New analysis from Hazlewoods shows that 47%, or 4,890 of the 10,400 UK law firms, are now incorporated businesses, up from 32% five years ago. Hazlewoods says there are two major advantages in the incorporated model – limited personal exposure for partners, and tax efficiency.

City AM, Page: 12

Contact Paul Southward.

Paul Southward