News Roundup Wednesday 17th April 2019

NEWS ROUNDUP

TAX NEWS

Scammer behind bars after tax probe

Serial fraudster Duncan Johnson has been jailed for four years and nine months after repaying a tax fraud debt with money stolen in another scam. Johnson admitted a £107,000 tax fraud but promised the judge that he’d repay the money, so sentencing was postponed for six months. But HMRC investigators discovered Johnson was raising the money to pay the debt through a second scam that involved stealing more than £500,000 from other businesses.

Press Release

HMRC accused of “conducting a co-ordinated attack” against actors

Actors union Equity claims hundreds of high-profile actors face massive tax bills and risk “losing their homes”, after the actor Robert Glenister lost a landmark dispute over his national insurance contributions. The Hustle star was found liable to pay £150,000 in backdated NI contributions covering a period of seven years, during which he provided services as a performer through a personal service company. HMRC said that Glenister would have been regarded as self-employed for tax if he had not used a personal service company to reduce his liability. The union accused HMRC of “conducting a co-ordinated attack” against its members.

The I, Page: 17

HMRC cutting callers off after 10 minutes

The Mail reports that HMRC is now cutting off taxpayers who spend hours trying to get through to someone to speak to. One self-employed consultant told the paper she spent all of Friday afternoon unsuccessfully trying to speak to HMRC about a £100 penalty she had wrongly received for a late tax return that she had filed in December. She says: “It was an automated message for ten minutes, and at the end they say we are too busy and the phone line goes dead. It is a ridiculous system. They make it incredibly difficult to speak to anyone.” The latest figures from HMRC show the average time to answer a call in February was six minutes 27 seconds, but this does not include the automated voice system. The target time is five minutes. An HMRC spokesman said: “We know that at busy times some customers have to wait longer, and we are doing all we can to keep all waiting times as low as possible.”

Daily Mail, Page: 48

CORPORATE NEWS

UK world’s top investment destination despite Brexit

A survey on corporate deal-making published by EY says Britain is the top investment destination in the world for the first time in the report’s 10-year history – overtaking the United States, which has held the top spot since 2014. EY said the UK had topped the rankings “despite continued uncertainty stemming from its intention to leave the European Union.” The UK’s top sectors for investment were consumer products and retail, industrials and financial services. The fall in the value of the pound since the 2016 Brexit referendum was not a major driver of foreign investment in Britain, EY said. “By and large, deals are driven by strategic rationale not currency movements,” said Steve Krouskos, EY’s global vice chair for transaction advisory services. “What hasn’t changed is that the UK has great companies, great talent, great tech and great IP. These assets attract capital. Also, remember the UK isn’t the only country dealing with significant geopolitical challenges.”

The Daily Telegraph The Times, Page: 33 City AM Daily Mail Daily Express

Monsoon Accessorize downsizing as CVA looms

The company behind the Monsoon and Accessorize fashion brands has appointed Deloitte to work on the potential closure of dozens of stores. A possible company voluntary arrangement (CVA) could lead to rent reductions for landlords and job losses. Monsoon Accessorize has closed almost 40 stores in the past two years but is aiming to speed up closures and is seeking creditor approval for a potential CVA.

The Times, Page: 33 The Sun, Page: 45 Daily Express, Page: 53 The Guardian, Page: 31 Daily Mail, Page: 69

Store First could be wound up

After Lancashire-based Store First offered investors a “guaranteed” 8% return on its a storage pod scheme within the first two years, increasing to 10% in years three and four, the Insolvency Service applied to have the business and four sister companies wound up in the public interest. Now thousands of people are unsure if they will get any of their money back, with former Top Gear presenter Quentin Wilson, who promoted the scheme and invested in it himself, among them. The Manchester District Registry of the High Court is to hear the winding-up petitions as part of a three-week session.

The Daily Telegraph

Gunning takes on CFO role at IAG

British Airways’ finance boss Steve Gunning is to replace Enrique Dupuy de Lôme as CFO at parent company IAG. Gunning has been CFO at British Airways since 2016 and acting director of IAG global business services since December 2017.

City AM The Times, Page: 38

SMEs NEWS

Is the small business commissioner finally warming up?

The Times’ James Hurley reports that Paul Uppal, the small business commissioner charged with tackling late payments to suppliers, has recovered just £3.7m of unpaid invoices to SMEs since December 2017 from a total of 125 cases of mistreatment. Mike Cherry, national chairman of the Federation of Small Businesses, said: “You can’t escape the fact that these numbers aren’t where we would ideally like them to be.” However, he said that the commissioner was “moving in the right direction”. Phil Hall, head of public affairs at the Association of Accounting Technicians, said that the modest figures were not a surprise since the commissioner had “no real powers”. But Conrad Ford, chief executive of Funding Options, said “the commissioner is finally hitting its stride” while Mr Uppal himself said he was “encouraged to see an increase in the number of complaints we have received.”

The Times, Page: 43

Government pledges funding for fast-growing firms

The government has pledged to provide a further £200m of funding to the British Business Bank to ensure that fast-growing private businesses have access to capital after Brexit. The funding is intended to mitigate any damage caused by loss of access to the European Investment Fund . Robert Jenrick, exchequer secretary to the Treasury, said: “The UK is creating more start-ups and attracting more venture capital funding than any other European country, but we want to do more to ensure our small businesses and entrepreneurs can thrive.”

Financial Times, Page: 3 The Times, Page: 50

Long Bailey: Labour will reform access to finance

Rebecca Long Bailey writes in the Yorkshire Post in support of Labour’s plans for a publicly-owned Post Bank. The shadow business secretary says the Post Bank, which will be run through the post office network, will “tackle financial exclusion, provide small businesses with the finance they need [and] ensure every community has easy access to face-to-face, trusted and affordable banking.” Labour will also create a £250bn National Investment Bank served by a network of Regional Development Banks that will lend to small businesses. “Labour is going to fundamentally reform the UK’s banking system, ensuring everyone can access to finance and supporting our economy to grow in a sustainable way,” says Long Bailey.

Yorkshire Post, Page: 13

SPORT NEWS

Former Rangers stars face huge tax bills after missing EBT deadline

Former Rangers stars face huge bills this year after failing to strike a deal with HMRC over the club’s Employee Benefit Trust (EBT) scheme. A source connected with the EBT investigation said: “Some former players were quick to agree a deal with the taxman who has been very fair in sorting out repayment plans. But others involved in the EBT scheme believe it’s the club who are to blame for this and are reluctant to pay the tax.” A Supreme Court ruling in July 2017 that said EBT payments made at Ibrox were not loans but earnings that should have been taxed.

Daily Record

PENSIONS NEWS

Brexit effect brings best ever pension deals to retirees

The Telegraph’s Laura Miller reports on how, on average, savers were offered £10,000 more last month to swap a guaranteed lifetime income for an immediate lump sum, compared to pensioners doing the same in February. Average transfer values for a 64 year old peaked at £251,000 – the highest level since pension freedoms were introduced in April 2015. Swings in the financial markets resulting from nervousness over Brexit have led companies to offer higher transfer values as they look to offload their liabilities, says James Baxter of transfer specialist Tideway.

The Daily Telegraph

Women pay for rise in state pension age yet again

Pensions expert Steve Webb is warning women approaching retirement that they may be missing out because of how pension pots are treated ahead of retirement. Pensions are usually shifted into safe investments ten to 15 years before people are expected to retire, but with the changes to the state retirement age from 60 up to 67, women could be missing out on seven years of more lucrative investment. “Life-styling” pensions too early could cost someone with an average pension pot of £50,000 up to £9,357 in returns over the course of retirement.

Daily Mail, Page: 48

PROPERTY NEWS

Best buy-to-let yields revealed

New research from lending platform Landbay has ranked the best places for buy-to-let landlords to invest in the UK, based on three key metrics: capital value growth, rental yield and rental price growth to achieve a total yield. Number one on the list is Newport, with a total annual yield of 13.22%, followed by Torfaen and West Lothian at 11.87% and 10.94% respectively. “Despite landlords suffering as a result of tax changes, these figures highlight the resilience of the UK’s residential property market,” says John Goodall, chief executive of Landbay. “Savvy landlords might be wise to consider looking further afield. Areas with significant investment in infrastructure like Manchester, Nottingham and Liverpool have also performed well.”

The Daily Telegraph

ECONOMY NEWS

New metrics reveal UK economy slowdown

New government economic indicators compiled by the Office for National Statistics (ONS), using “big data” from things like VAT and road traffic, have suggested that the UK economy slowed down very slightly in March. The Telegraph points out that business surveys had pointed to a more severe slowdown in recent months and the ONS hopes that by using “hard” data instead of surveys it will be able to offer a more comprehensive insight into the economy.

Financial Times, Page: 1 City AM The Guardian The Daily Telegraph, Business, Page: 4 The Times, Page: 34

Unemployment continues to fall

Unemployment fell by 27,000 in the three months to February to 1.34m, ONS figures show. The number of people in work was also virtually unchanged at a record high of 32.7m, with a jump of 179,000. The figure has increased by 457,000 over the past year, all among full-time employees and the self-employed. Average weekly earnings, excluding bonuses, had an estimated rise of 3.4%, before adjusting for inflation. When adjusted for inflation, pay, including bonuses, increased by 1.5% on the year, the highest figure since the summer of 2016.

The Daily Telegraph Financial Times, Page: 1 The Times

OTHER NEWS

PM Corbyn as bad as no-deal Brexit warns Citigroup

US bank Citigroup has warned that Jeremy Corbyn as prime minister would be just as bad for UK banks as a no-deal Brexit as fears grow in the City of a collapse in support for the Tory party. Researchers told clients that the current Labour manifesto with its “deficit financed policies” could lead to capital outflows from the UK.

The Daily Telegraph
Contact Paul Southward.

Paul Southward