News Roundup Tuesday 6th August 2019
News Roundup Tuesday 6th August 2019
Taxpayers’ Alliance: Death getting dearer
Research published by the Taxpayers’ Alliance (TA) shows that inheritance tax and probate fees are driving up the cost of death, with the Government set to receive £5.35bn from relatives of those who pass away this year and next. The Cost of Death report notes most estates do not pay inheritance tax and highlights that while the cost of death varies across the UK, the average cost for homeowners in England is £405, with this covering probate fees, land registration fees and death certificate costs. John O’Connell, chief executive of the TA, says IHT is “anti-aspirational”, asking: “Why work so hard to look after your children if the taxman guzzles it all up anyway?” On proposed increases to probate fees, he added: “Hopefully this stealth death tax rise will be dropped and taxpayers can breathe a massive sigh of relief.”
FTSE 100 boards cut tax dispute cash pots
Figures from Thomson Reuters show that FTSE 100 companies put aside £4.5bn to cover tax disputes in 2018/2019, down from the £5.2bn set aside in 2017/2018.
Doctor calls for pension tax rethink
In a letter to the Times, BMA council chair Dr Chaand Nagpaul says pension reforms have seen a number of doctors face high tax bills, saying doctors “are paying to go to work.” The issue, he adds, is causing staff to reduce hours and a proposed solution would not see tax rules changed but would merely offer doctors flexibility in the way they save for their pensions. He calls for “major reform” to the annual allowance and tapering annual allowances.
Scots insolvencies climb 45%
Analysis from KPMG shows that Scottish insolvencies have risen by more than 45%, with 698 corporate insolvency appointments in the six months to June. This is up from the 479 recorded in the first half of 2018. The figures for H1 2019 saw 661 cases involving a company liquidation, while there were 37 administration and receivership appointments.
The Scotsman, Page: 32 The Press and Journal, Page: 31
Spudulike shuts up shop
Baked potato restaurant chain Spudulike has closed all 37 of its takeaway branches, with all 298 employees made redundant. The business collapsed after failing to secure backing from landlords for a rescue restructure, with a CVA rejected and attempts to find a buyer failing. Neil Bennett and Alex Cadwallader of Leonard Curtis were appointed joint administrators of parent company T&G Fast Food Developments.
Daily Mirror The Guardian, Page: 23 Daily Mail, Page: 4
Denmark wants Just Eat to deliver £126m
Danish authorities say Just Eat failed to pay enough tax after shifting its headquarters from Copenhagen to London in 2012 and last year made a £126m claim against the fast-food delivery app business.
The Times, Page: 34
Ashley seeks Jack Wills deal
Sports Direct owner Mike Ashley is reportedly closing in on a deal to buy struggling fashion retailer Jack Wills. The retailer has been searching for a buyer for the past month, with the Mail saying its sale may be structured as a pre-pack administration.
Daily Mail, Page: 66
SMEs not ready for no-deal
Many smaller businesses are “desperately under-prepared” for a no-deal Brexit, the Federation of Small Businesses has warned. Martin McTague, the FSB’s policy and advocacy chairman, has called for clarity over £108m the Treasury has said was set aside to promote and support businesses to ensure they are ready for Brexit, saying: “We urgently need more information about what this money is actually for,” asking: “What kind of support will it fund? How many small businesses will be able to access it? When will they be able to access it?” Craig Beaumont, director of external affairs at the FSB, has called for resources to help small firms work out what they can do to prepare for a no-deal scenario.
The Times, Page: 38
10k cyber-attacks a day on small firms
The Federation of Small Businesses (FSB) has said that the UK’s small companies are collectively subject to almost 10,000 cyber-attacks a day. In a report, the FSB said that one in five small firms had been the victim of a cyber-attack in the two years to January, with an average of 9,741 incidents reported daily in that period. Phishing attempts are the most frequently reported form of cyber-attack, affecting 530,000 small firms over the past two years. Malware (374,000 firms), fraudulent payment requests (301,000) and ransomware (260,000) incidents were also frequently reported.
The Times, Page: 37 The Scotsman, Page: 32 City AM, Page: 10
One in six firms falls into rates arrears
Research by business rates consultancy Altus has estimated that almost one in six businesses in England have been issued a summons for non-payment of business rates in the past year. Robert Hayton, head of UK business rates at Altus, said increases in business rates were having a detrimental effect on the economy, saying major retail and hospitality businesses “are reducing their estates and headcount, often citing the high level of rates as a contributory factor.” In total, the firm found that around 190,000 businesses, over 500 a day, were issued a summons last year.
Financial Times, Page: 3 The Daily Telegraph, Page: 26 The Guardian, Page: 18 Daily Express, Page: 49
IMF expert: PM can spend to boost the economy
Olivier Blanchard, the former chief economist of the International Monetary Fund, believes Boris Johnson will be able to embark on a spending spree to boost the economy after Brexit, saying ultra-low bond yields mean deficits can be widened with little damage to public finances. He told the Telegraph: “Not only does debt have lower costs, deficits have larger benefits”, adding: “If the economy is not at full employment, and monetary policy has run out of ammunition, then deficits can help maintain demand and maintain low unemployment.” Considering the UK, Mr Blanchard said there is little need for spending restraints but there is “not much of an argument” for widening the deficit as the economy is close to full employment. He added, however, that if Brexit brings a change and the economy slows down considerably, “fiscal help would be needed.”
Profits see worst quarter since 2016
A report from the Share Centre shows that revenues at listed UK businesses rose by 1.6% in Q2 2019, while pre-tax profits were up 3.1% on Q2 2018. These figures mark the weakest set of quarterly results since 2016. More than half of the FTSE 350 reported lower profits, while a third saw sales declines during the period. The Times says that while the Brexit-related weakness of sterling has lifted the value of revenues and profits generated abroad, sales and earnings would be down if the foreign exchange impact was stripped out.
The Times, Page: 34 The Daily Telegraph, Page: 28
Only three in 10 exporters ready for no-deal Brexit
Only 27% of the 245,000 businesses HMRC says would need an Economic Operator Registration and Identification number to export to the EU in the event of no-deal Brexit have applied for one.
Europe bickers over passporting future
Siobhan Riding looks at passporting and asset managers’ cross-border activities, with insight offered by David Doyle and John Liver of EY and KPMG’s Julie Patterson.
Contact Paul Southward.