News Roundup Wednesday 6th February 2019
News Roundup Wednesday 6th February 2019
Deadline day returns up 29% in 5 years
The Telegraph’s Anna Mikhailova looks at how increasing numbers of taxpayers are leaving filing their returns until close to the deadline. Figures show that over 735,000 people filed their tax return on January 31 – 29% more than those leaving it until deadline day five years ago – with 30,000 submitting their returns between 11pm and midnight. The taxman’s hotline received over 100,000 calls on January 31 and 4.8m in total in January – up 2m on the total received in December. Ms Mikhailova highlights that while 14% of callers faced waiting times of more than 10 minutes, the average call met HMRC’s target of a wait of under five minutes. She notes that last year the Commons Public Accounts committee suggested HMRC had misled the public over waiting times by not including up to four minutes of automated messages per call in its statistics.
Rate relief offers marginal boost – Landlord
Shopping centre landlord Ellandi says the Government’s small business rates relief due to be introduced in April will only give town centres a minimal boost. It says research from property consultancy Montagu Evans shows that relief measures will only trim Ellandi tenants’ total rates bill of £37m by £700,000 – less than 2%. Mark Robinson, property director and co-founder of Ellandi, said: “Given the structural changes happening within the retail industry, it is imperative that Government urgently looks at fundamental reform of the way the retail industry is taxed.”
City building rates climb
Deloitte ’s annual crane survey, which gauges the volume of commercial property under construction, has revealed record levels of construction activity in Britain’s cities. Birmingham, Manchester and Leeds saw 88 new developments started last year, up on the 72 recorded in 2017. The number in Belfast was flat at nine, although office development rose by 35%.
The Times, Page: 40 Yorkshire Post, Business, Page: 1
Regional pre-lets boom
The number of businesses agreeing to pre-let offices outside London is at a record high, according to real estate firm Cushman & Wakefield. More than 12m sq ft of regional offices were rented out on a pre-let basis in the past two years, with pre-let space now accounting for 8% of all office construction. It is noted that a major reorganisation of the public sector’s property estate, particularly by HMRC, has helped boost demand.
The Daily Telegraph, Business, Page: 3
SME VAT investigations pull in extra £3.75bn
HMRC collected an extra £3.75bn from SMEs last year through investigations into the underpayment of VAT, with this total marking a 12% increase on the previous year. PfP says this extra revenue made up half of all revenue collected through investigations into SMEs in 2017/18. It added that VAT receipts, which represent over a fifth of total tax receipts, reached a record high of £125bn last year, up 60% on a decade ago.
City AM, Page: 10
Landlord takes on arch sites
The Arch Company, Britain’s biggest small business landlord, plans to bring 900 abandoned railway arch sites back into use. The landlord, a joint venture between American private equity group Blackstone and British property manager and investor Telereal Trillium, comes into being today and has pledged to support independent businesses. The landlord says some sites may see rent increases.
The Times, Page: 42
MiFID II rules now hitting UK SMEs
The EU’s new MiFID II rules, which force brokers to charge for research rather than wrap it up in banking fees, are leaving UK SMEs finding it harder to raise funds. A fresh survey of investors by Peel Hunt and the Quoted Companies Alliance warns the quality of brokers’ research is consequently getting worse, making it harder for fund managers to justify buying into potential growth stocks.
ICAEW: Business confidence dips
The ICAEW’s business confidence monitor suggests that corporate sentiment has dipped, with a reading of -16.4 for the last quarter, compared with -12.3 for the previous quarter. Confidence has dipped in all sectors apart from IT, property, construction and retail. ICAEW chief executive Michael Izza said company directors are relying on “guesswork” when anticipating the impact of Brexit on business models.
Insolvencies surge as businesses face chill winds from all quarters
The FT looks at how corporate insolvencies hit levels not seen in five years in 2018, with Begbies Traynor saying the number of businesses in financial distress jumped in Q4.
Accountants paid £300k in BTG deal
Drugs company BTG is to be acquired by rival Boston Scientific in a £3.3bn deal that will see it pay almost £41m to bankers, lawyers, accountants and public relations executives, with £300,000 going to accountants. Meanwhile, KPMG, EY and Deloitte are set to see large payouts on the back of the tie-up between drugmakers Bristol-Myers Squibb and Celgene.
Google tax bill questioned
Google’s tax affairs have been criticised after parent company Alphabet revealed Q4 profits of £6.9bn, taking full year profit to around £23.6bn. Campaigners had spoken out against Google UK after accounts published last year showed its corporation tax bill came to £49.3m for the year to June 2017, with sales of £1.27bn and profits of £202.4m. Paul Monaghan of campaign group Fair Tax Mark said: “The continued funnelling of UK income into low-tax Netherlands and on to zero-tax Bermuda is an affront to all those who pay their fair share of taxes.” Google said it pays all taxes due and complies with the tax laws in every country it operates in.
Daily Mail, Page: 67
Millennials pay scarred by financial crisis
New research from the Resolution Foundation has suggested that pay for workers in their 30s is still 7% below the level at which it peaked before the 2008 financial crisis. The think-tank said people who were in their 20s at the height of the recession a decade ago were worst hit by the pay squeeze. The research found those who stayed in the same job in 2018 had real wage growth of 0.5%, whereas those who found a different employer saw an average increase of 4.5%.
Professionals’ confidence in UK economy at record low
Confidence in the UK’s economic prospects among financial services professionals is at its lowest level since 2012, according to a poll of members of the Chartered Institute for Securities & Investment (CISI). Highlighting the latest ACCA member survey, which showed confidence in the UK’s economy is at its lowest level since 2009, CISI chief executive Simon Culhane said: “Businesses abhor uncertainty, they can’t plan, they can’t invest and they can’t recruit and now, with less than two months before the UK plans to leave, we have complete uncertainty, so this survey result is no surprise.”
Sales climb in January
British Retail Consortium / KPMG figures show that discounting contributed to total retail sales rising 2.2% in January, the highest growth since June 2018. This follows the worst December trading in a decade.
The Times, Page: 40 Daily Express, Page: 45 City AM, Page: 3 Yorkshire Post, Page: 4 Aberdeen Press and Journal, Page: 33
Brits borrow more than they earn
Figures from the Office for National Statistics show that Britons are borrowing a third more than they take home after tax. The data shows the average person owes £26,800 a year despite a disposable income of £20,200.
The Sun, Page: 18
BBC in £1m pay boost
It is reported that the BBC has paid staff wrongly told to register as self-employed an extra £1m – with almost 300 presenters seeing a one-off payment of around £3,750 in their January pay packet. This comes after staff were advised to set themselves up as self-employed, with salaries routed through personal service companies, allowing them to be taxed as a company and pay 20% corporation tax. A crackdown by HMRC made it the BBC’s responsibility to get people’s employment status correct for the purposes of tax collection. This left some BBC staff facing backdated tax payments. A BBC spokesman said the payment was not a bonus but given to staff instead of expenses they were unable to claim while changes were made to their employment status.
Banking app plans MTD tools
Financial admin start-up Anna Money has landed £8.5m in funding from Kinetik. The firm says it is preparing to launch several new tools in anticipation of HMRC’s Making Tax Digital scheme.
Contact Paul Southward if you have any queries.