NEWS – TUESDAY 11TH AUGUST 2020

NEWS ROUNDUP

TAX NEWS – TUESDAY 11TH AUGUST 2020

Homes and estates – targets for wealth taxes?

Harry Brennan provides Telegraph readers with an overview of what a wealth tax could look like, with a focus on a tax on property gains and a new inheritance tax. He cites the Social Market Foundation which has called for a new 10% CGT rate on the sale of homes so older people pay more towards the pandemic recovery. Separately, the All-Party Parliamentary Group on Inheritance and Intergenerational Fairness says the IHT system should be abolished and replaced with a new 10% tax for modest estates, with 20% levied on estates worth more than £2m. Tom Elliott of advice firm Crowe UK said: “So few estates pay the tax that it would hardly be a vote-loser if the rate was increased. If anything, such a proposal would be a politically positive step.”

The Daily Telegraph

Dutch ‘departure tax’ could derail Unilever’s unification plans

A proposed levy on firms which relocate out of the Netherlands could land Unilever with an €11bn bill. The law is designed to compensate Holland for the loss of tax revenue if companies with annual revenues of more than €750m do choose to leave. Although the legality of the bill is contested and the chances of it being passed are slim, Unilever says it would not be in its best interests to pursue the proposed unification of its Anglo-Dutch structure if the bill were enacted in its present form.

The Daily Telegraph, Business, Page: 1, 2 The Times, Page: 36 Daily Mail, Page: 73

CORPORATE NEWS – TUESDAY 11TH AUGUST 2020

New investigation into NMC Health

NMC Health is being investigated over claims it used fake invoices and forged documents relating to purported medicine sales to obtain credit from banks. The alleged scheme involved the funnelling of loans worth billions of UAE dirhams to the collapsed hospital firm via Neopharma, an outfit owned by NMC founder BR Shetty. The investigation raises questions about oversight from banks and will be another headache for NMC’s auditor, EY, which is being probed by the UK’s Financial Reporting Council over its work for the company. The Financial Conduct Authority is also looking into the collapse of NMC.

The Daily Telegraph Financial Times, Page: 7 Daily Mail, Page: 74

Select on its knees for third time

The troubled fashion chain Select has been forced to approach landlords for a third time to beg for rent cuts. Select first went through an insolvency process to slash its rent bill in 2018, then went bust last year and agreed a second CVA with creditors in June. Brokered by Quantuma, the deal saved 1,800 jobs. Now it is working with Howard Kennedy on another CVA which the Telegraph suggests will spark fears that store closures and job cuts could be on the horizon this time.

The Daily Telegraph, Business, Page: 3

Record profit warnings issued after pandemic struck

A report from EY reveals British travel, leisure and retail companies suffered their worst first half on record this year, with nearly 75% of listed businesses in those industries forced to issue profit warnings. Including businesses in other sectors, EY recorded 466 profit warnings from London-listed companies in the first six months of this year. That compares with 313 in all of last year.

The Times, Page: 39

PROPERTY NEWS – TUESDAY 11TH AUGUST 2020

Landlords seek out holiday lets

Landlords are taking advantage of the stamp duty holiday and a rise in the popularity of staycations by investing in properties targeted at domestic tourists. Research by Knowledge Bank shows a sharp rise in inquiries for holiday let mortgages during July. The most popular search among buy-to-let landlords was for loans to limited companies, suggesting that many owners are taking advantage of the stamp duty break to transfer their properties into a company structure. Matthew Corker, of Knowledge Bank, said: “Transferring to a limited company means landlords, especially higher-rate taxpayers, will benefit from favourable tax treatment of their rental income.”

The Daily Telegraph

EMPLOYMENT NEWS – TUESDAY 11TH AUGUST 2020

COVID-19 accelerates shift to more remote working

A survey by PwC found that almost nine in 10 UK chief executives expect the pandemic to prompt a permanent shift towards remote working. Kevin Ellis, chairman and senior partner at PwC UK, said: “While a large majority of UK and global CEOs believe COVID-19 has accelerated a long-term shift to more remote working, a blend of office and home working is most likely to be the future norm. There are many benefits of people coming together face to face, particularly when it comes to learning and innovation.” The survey also found that UK business leaders were more likely than their international peers to provide financial assistance to staff and support the mental health and wellbeing of workers.

The Daily Telegraph, Business, Page: 8 The Times, Page: 41 The I, Page: 44

SMEs NEWS – TUESDAY 11TH AUGUST 2020

Small shops have shed over 50,000 staff

A survey by the Federation of Small Businesses (FSB) reveals that Britain’s independent retailers have been forced to lay-off more than 53,000 staff since the pandemic began. Mike Cherry, national chairman of the FSB said: “Thousands of small retail businesses were left with some very tough decisions to make last quarter following months of little or no revenue coming in. As high streets reopen, it’s critical that all of us shop local and support our favourite small businesses wherever possible.”

Daily Mail, Page: 73

PENSIONS NEWS – TUESDAY 11TH AUGUST 2020

Two companies to pay £10.7m to investors sold risky schemes

Two unauthorised “pension introducers” have been ordered by the FCA to pay £10.7m in restitution to retirees who were “induced” to transfer their pensions into risky, unregulated schemes. The action was the first of its kind taken by the regulator. Avacade Future Solutions and Alexandra Associates and three directors – Craig Lummis, Lee Lummis and Raymond Fox – have been ordered to make the payment.

Financial Times, Page: 10 FT Adviser Money Marketing The Daily Telegraph, Business, Page: 4 The Sun, Page: 43

REGULATION NEWS – TUESDAY 11TH AUGUST 2020

Fines for anti-money laundering failures rise as companies repeat mistakes

Anti-money laundering failures are being punished more harshly of late, Duff & Phelps says, with fines levied in the first half of this year hitting $706m, up from 2019’s $444m.

Financial Times

ECONOMY NEWS – TUESDAY 11TH AUGUST 2020

UK retail sales remain robust in July

Data compiled by KPMG and the British Retail Consortium show UK retail sales by value increased 3.2% in July compared with the same month a year ago – the second consecutive month of growth following three months of falling sales. Online purchases accounted for 42% of all sales down from 50.5% in June, indicating consumers were returning to the high street. Separate data from Barclaycard found overall UK consumer spending was down by 2.6% in July, compared with 2019 – the smallest fall in spending since lockdown restrictions were first imposed.

Financial Times, Page: 2 BBC News The Times, Page: 34 The Daily Telegraph, Page: 7 The Guardian, Page: 28 Yorkshire Post, Page: 1

OTHER NEWS – TUESDAY 11TH AUGUST 2020

Collymore: It’s not a good look, lads

Former Liverpool football star Stan Collymore hits out at young players for using image rights to shirk their tax responsibilities. In a piece for the Daily Mirror, Collymore says he first heard of the exploitation of image rights about ten years ago, “when Portsmouth’s dirty linen was being aired in public”. He explains: “That was the first time I’d heard of players who wouldn’t even be recognised in their own street, let alone worldwide, trying to use image rights to avoid paying fair tax.” Sunday’s news that 246 players were being investigated by HMRC, “made me slump in despair,” he says, adding: “Come on, agents and players, you’re getting a great screw these days, even below the Premier League and Championship. This loophole was closed years ago and the taxman will rightly be onto you if you’re not careful.” His comments come after research by UHY Hacker Young showed the number of footballers being probed by the taxman has trebled in a year.

Daily Mirror, Page: 47 Daily Mail, Page: 19

Contact Paul Southward

Paul Southward