News Roundup Wednesday 3rd April 2019
News Roundup Wednesday 3rd April 2019
The tax changes to expect on April 6
The Telegraph’s Sam Meadows provides an overview of the tax changes to expect from April 6th this year, including: increases in the tax-free personal allowance and the higher-rate allowance; the increase in the amount homeowners can pass on to descendants; the increase in the lifetime allowance on pension contributions – from £1.03m to £1.05m – and the next stage of the phased removal of mortgage interest relief for landlords. Patricia Mock of Deloitte provides commentary on these changes and those to CGT and Entrepreneur’s Relief.
Independent MPs want tax rise on highest paid
The newly-formed group of independent MPs, called Change UK, has called for a tax increase on the highest earners. Its leader Heidi Allen told the BBC she wants a “sweet spot” to spend the cash on the NHS and education.
The Sun, Page: 6
Stride unrepentant on loan charge hardship
Mel Stride has defended HMRC’s pursuit of taxpayers who used loan-based schemes to reduce their tax bills despite claims charges are leading people to commit suicide.
Léo Apotheker denies gross negligence in Autonomy acquisition
With the court battle between Hewlett-Packard (HP) and Autonomy founder Mike Lynch continuing, HP’s former CEO Léo Apotheker has been forced to admit he failed to read Autonomy’s two most recent quarterly earnings ahead of the disastrous buy out of the firm for £8.4bn in 2011. HP wrote down the majority of the value of Autonomy in 2012. The deal is now the focus of a £4bn dispute between HP and Autonomy’s founder, Dr Lynch, who has been accused of inflating the company’s accounts ahead of the acquisition. Dr Lynch denies the allegations. Mr Apotheker refuted accusations he had been “grossly negligent” insisting that had he been aware of Autonomy’s alleged accounting issues he would have acted.
FCA faces probe over LCF collapse
The Financial Conduct Authority is facing a government probe into its oversight of London Capital & Finance (LCF), after customers of the firm lost thousands of pounds in investments. It follows concerns the FCA was too slow to protect consumers before LCF went into administration last month. Some 11,605 people invested a total of £236m with LCF, but only about 20% of this money may end up being recovered. The Treasury, which will run the probe, said it was “incredibly concerning”. The Economic Secretary to the Treasury, John Glen, said: “By ordering this investigation, we will better understand the circumstances around the collapse and make sure we are properly protecting those who invest their money in the future.”
RSM standing by as miner teeters on the edge
London-listed Churchill Mining appears set to enter administration after it lost a battle with the Indonesian government. The firm placed RSM on standby after it lost licenses, and a bid for compensation, for one of the world’s largest coal deposits.
Struggling landlords want tax breaks to help with new energy laws
Many landlords cannot afford to upgrade their properties’ energy efficiency to meet new laws which came in on Monday. All new tenancies with Energy Performance Certificate (EPC) ratings of F or G must have upgraded to at least band E by April 1 and, while landlords who have not carried out the work can be fined up to £5,000 by local authorities, the Residential Landlords Association has warned that such an outlay could cause 20% of landlords with F or G rated properties to sell up, while over half (51%) would be forced to raise rents to compensate. Landlords who repair homes can claim the cost back against their income tax, but they cannot do this for improvements, and the RLA has now urged the Government to make any EPC-related upgrade work tax-deductible.
Factories stockpile for Brexit as eurozone manufacturing crashes
UK factories stockpiled goods for Brexit at an unexpectedly high rate last month, boosting manufacturing growth to a 13-month high, according to the IHS Markit/CIPS survey. The Purchasing Managers’ Index (PMI) for the manufacturing sector rose to 55.1 in March, from 52.1 in February. A figure above 50 indicates expansion. Samuel Tombs, chief UK economist at Pantheon Macroeconomics, commented: “We continue to doubt that precautionary stockpiling for a no-deal Brexit will boost GDP, because manufacturers primarily are buying imports and are tying up cash that otherwise might have been used for investment. All told, then, the PMI should not instil any confidence about the near-term outlook for the manufacturing sector.” Meanwhile, the IHS Markit eurozone manufacturing PMI fell to 47.5 last month, down from 49.3 in February and the lowest reading since April 2013. The downturn has hit the eurozone’s three biggest economies. Germany had a PMI reading of 44.1, the lowest for more than six-and-a-half years.
Brexit uncertainty ‘costing UK £600m per week’
The UK’s v ote to leave the European Union has cost the country £600m per week since the June 2016 referendum, according to a Goldman Sachs report. The bank estimates that almost 2.5% has been knocked off economic growth amid a lack of clarity surrounding Britain’s departure from the EU. Separately, the British Chambers of Commerce has warned that Brexit-related uncertainty means the number of companies planning to invest in their operations is at its lowest level in eight years.
BUSINESS TAX CHANGES FROM APRIL 2019
Check out our latest download here: 2019/20 Business Tax Changes
Contact Paul Southward.