Archives

NEWS – TUESDAY 27TH APRIL 2021

NEWS – TUESDAY 27TH APRIL 2021

NEWS ROUNDUP

TAX NEWS – TUESDAY 27TH APRIL 2021

White House says capital gains tax rise will hit only richest 0.3%

Following heavy criticism of new tax plans coming out of the White House, a Biden administration official has said only the richest 0.3% of Americans would have to pay the new levy on capital gains. The Mail reports that wealth advisers in the US are seeing a flood of inquiries as clients rush to sell assets, shift gains into retirement accounts or tax-deferred opportunity zone funds.

Financial Times, Page: 6 Daily Mail

Brussels targets tax rules in EU recovery plans

The European Commission is using the Covid recovery fund to leverage certain rule changes from nation states, with Ireland among those facing demands to clamp down on sweetheart corporate tax deals.

Financial Times, Page: 4

SMEs NEWS – TUESDAY 27TH APRIL 2021

SMEs looking to spend £97,000 on business growth

New research from Aldermore Bank indicates signs of recovery for small and medium-sized enterprises (SMEs), as they reveal plans to invest in their businesses in the next year, coinciding with the easing of lockdown restrictions. SMEs plan to spend an average of £97,000 to grow their business in 2021 and help kickstart their recovery from the COVID-19 pandemic. Over the next 12 months, one in four (25%) SMEs will invest in their online presence, with one in five (21%) advancing their digital marketing. A further one in four (21%) will spend on new equipment and 20% will invest in their staff through training. “It’s encouraging to see that SMEs are investing in their recovery from the COVID-19 pandemic”, said Tim Boag, group managing director, business finance at Aldermore. “Recent data reveals a vastly improved near term outlook for businesses, with the easing of restrictions. Confidence from SMEs is growing, and this is reflected in plans to invest in the growth of their businesses in order to recover effectively from the pandemic”.

Business Money The Scotsman

FINANCE NEWS – TUESDAY 27TH APRIL 2021

Ethnic minorities excluded from VC funding

Research by angel network Cornerstone Partners shows that entrepreneurs from black and ethnic minority backgrounds are being excluded from venture capital funding. Just 1% of founders who receive seed funding identify as black, according to the study. Only 3% of VC-funded founders identified as black and only 2.9% were Asian. The report also says that three quarters of founders come from advantaged socio-economic backgrounds and hardly any founders come from families living on welfare entitlements. Cornerstone Partners has made a number of recommendations, including the establishment of schemes that support angel groups and accelerators which invest in businesses led by minority founders. It also called for the introduction of early career development.

The Times

PROPERTY NEWS – TUESDAY 27TH APRIL 2021

One in six homes sell for more than asking price

Figures from NAEA Propertymark show one in six homes sold in March went for more than the asking price – a seven year high – with just a third selling for below the original price. Mark Hayward, chief policy adviser at Propertymark, said: “The imbalance of supply and demand means it’s an extremely strong sellers’ market; properties are selling quickly and for over the asking price, and this is something we expect will continue in the coming months.” Homeowners reconsidering their lifestyle and the stamp duty holiday are seen as the main drivers of the increased demand.

The Daily Telegraph

PENSIONS NEWS – TUESDAY 27TH APRIL 2021

Retired workers’ income set to fall dramatically

A new report from LCP warns that it will take too long to save into defined contribution (DC) pensions to keep retirement savings steady and offset the loss of defined benefit (DB) income. The report, titled ‘The ski slope of doom – is this the most worrying chart in pensions?’, claims that the incomes of newly retired workers are set to fall at a much more dramatic rate in the coming decades than had previously been thought. The report found that for those working in the private sector, the decline of traditional “final salary” type pensions is more rapid than expected and that the rise of new-style workplace pensions will take longer to make a real impact than previously assumed.

Daily Express FT Adviser IPE Money Marketing Professional Pensions

PERSONAL FINANCE NEWS – TUESDAY 27TH APRIL 2021

Advice firm encourages inheritance discussions

Research from the Institute for Fiscal Studies shows that inheritances are likely to be larger compared with lifetime incomes for younger generations than was the case for their predecessors. For those born in the 1980s, average inheritances compared to lifetime income are projected to be almost twice as large as those born in the 1960s.

Daily Express

ECONOMY NEWS – TUESDAY 27TH APRIL 2021

UK growth forecasts boosted by vaccines rollout and extended state support

Analysis by Consensus Economics puts UK growth at 5.4% this year, up from 4.2% predicted in February. Others believe this remains pessimistic, however, with Oxford Economics going as high as 7.2%. The EY ITEM Club has predicted growth of 6.8% while Goldman Sachs goes as high as 7.8%. A bounce-back is not unexpected considering the UK suffered a 9.8% slump in 2020 – the worst performance among the G7 group of major advanced nations but forecasters are upgrading predictions following the “innovative and flexible” response of UK businesses and consumers to the pandemic.

Financial Times, Page: 2 Sky News The Times, Page: 34

Investors may have to wait until 2025 for dividend recovery

According to Link Group’s Dividend Monitor, British companies paid out £12.7bn in dividends in the first quarter of 2021, down 27% on the same period last year. Reduced payouts from oil giants Shell and BP were responsible for most of the drop. Link said dividends were down 42% over the last 12 months and its “best-case” forecast for this year was a rise of just 5.6% on last year’s total. Ian Stokes of Link Group said there were signs of recovery but “2025 still looks like the most realistic moment for dividends to match their 2019 high point.”

The Daily Telegraph The Times

REGULATION NEWS – TUESDAY 27TH APRIL 2021

City bosses want payback after being left on Brexit sidelines

The Telegraph’s Lucy Barton looks ahead to what’s in store for the City post-Brexit as organisations including the Investment Association submit ideas to the Treasury for reform. The lobby group told ministers to consider a fully exempt tax regime for UK funds to keep them competitive with EU rivals. One banking executive who is in regular talks with ministers told the paper: “There will definitely be changes. Banking is completely exposed to politics and political changes – that’s always a huge risk – but I’ve never seen such commitment to change.” But although Rishi Sunak has told the City to brace itself for a “Big Bang 2.0” post-Brexit, TheCityUK’s CEO Miles Celic argues the sector is not chasing a “deregulatory agenda”. He says: “Competitiveness is about much more than regulation – it’s got to look at issues such as access to talent and a stable, predictable, simplified tax regime.” Finally, Barnabas Reynolds at Shearman and Sterling believes big changes are on the way, but it could take three to five years for the rule book to look significantly different.

The Daily Telegraph, Business, Page: 2

OTHER NEWS – TUESDAY 27TH APRIL 2021

Johnson hopeful restrictions will lift on 21st June

Boris Johnson has said Britain had built “some pretty robust fortifications” against another wave of Covid and there is now a “very good chance” of completely ending coronavirus restrictions in England on June 21st, as planned. The prime minister said lockdown had helped get the number of cases down considerably but that did not mean Covid was over.

The Times

Contact Paul Southward

Paul Southward

NEWS – WEEKEND TO 25TH APRIL 2021

NEWS – WEEKEND TO 25TH APRIL 2021

NEWS ROUNDUP

OTHER NEWS – WEEKEND TO 25TH APRIL 2021

SUNDAY

Time for citizens to take back control, scientists say

In an open letter published today, leading scientists say ministers and Government advisers are exaggerating the threat from COVID-19 and that all restrictions must be lifted on June 21 – the final date in Boris Johnson’s roadmap out of lockdown. They argue that with data showing vaccines reduce the risk of death by 98% and hospitalisations by more than 80%, COVID-19 is being turned into a mild disease in Britain. The letter’s 22 signatories include Professors Carl Heneghan and Sunetra Gupta from Oxford University, Emeritus Professor Hugh Pennington from the University of Aberdeen and Professor Robert Dingwall from Nottingham Trent University. “We are being told, simultaneously, that we have successful vaccines and that major restrictions on everyday life must continue indefinitely. Both propositions cannot be true,” the scientists write. They add: “Mandatory face coverings, physical distancing and mass community testing should cease no later than 21 June along with other controls and impositions. All consideration of immunity documentation should cease.”

The Sunday Telegraph, Page: 1 Sunday Express, Page: 1 The Mail on Sunday

“It is time to free up businesses and people to start really building back our economy and the nations health.”

TAX NEWS – WEEKEND TO 25TH APRIL 2021

SATURDAY

Investors in uproar over Biden’s proposed capital gains tax rise

Investors have lashed out at Joe Biden’s plans to double capital gains tax with Scott Minerd at Guggenheim Partners declaring the plans “insanity” while Anthony Scaramucci, founder of SkyBridge Capital, believes the proposals would “have deleterious effects on job creation and wage growth for middle-class workers.” Stocks fell following the announcement and cryptos such as Bitcoin and Ether fell sharply. Although the plans will face stiff opposition in Congress, fund managers warn that investors could dump “momentum” stocks as they seek to crystallise gains ahead of a tax hike. Alasdair McKinnon, manager of the Scottish Investment Trust, said the impact of Biden’s proposals would be felt across America’s stock market. “New capital gains taxes are unhelpful to all asset prices,” he said.

Financial Times, Page: 8 The Daily Telegraph, Page: 39 The Times, Page: 51 Daily Mail The Independent The Guardian, Page: 44

EU plans creeping tax harmonisation

The Express reports on plans touted by the European Commission to harmonise tax rates across the bloc for tobacco products. Pieter Cleppe, a research fellow with the Brussels-based Property Rights Alliance, said in a paper that the Commission is exploring ways to do this without EU Treaty change, “using health concerns as a pretext to obtain more power.”

Daily Express

HMRC deadline extension creates state pension headache

HMRC has warned that small business owners and those with ‘side hustles’ could miss out on state pension benefits if they filed their tax return after January this year.

Financial Times, Page: 2

SUNDAY

Conservatives should fight an international tax stitch-up

Hamish McRae asserts in the Mail on Sunday that if Joe Biden gets his tax hikes though Congress other countries would have cover for introducing similar measures too. The new administration wants to tax capital gains as income, raise corporation tax and introduce a global minimum tax rate. McRae says following the extreme pandemic spending by governments, raising taxes on the wealthy is logical and fair and hard to argue against. The Observer’s business leader lauds Biden’s move believing the tax hikes and trillions in stimulus are intended to tackle “deep-rooted inequalities” and that the UK Government should use Washington’s move to inspire its own plans to build back better. But Daniel Hannon contends in the Sunday Telegraph that plans for international tax harmonisation, with legal threats against those who resist, “would mark the birth of a high-tax cartel, and the rate would surely rise”. Socialists have long resented the fact that exorbitant taxes redistribute people rather than wealth, but without international competition this inconvenience would end, he says, as would the right of poor nation states to try and improve their lot through tax cuts. Ultimately, Hannan adds, low taxes improve revenue, employment and economic activity – all things needed to repair shattered post-pandemic public finances, but this seems to have been forgotten by Conservatives in the UK.

The Observer, Page: 56 The Mail on Sunday, Page: 122 The Sunday Telegraph, Page: 20

HMRC sends 18,500 fines to wrong address

HMRC has sent 18,500 fines to the wrong address with a software error said to be to blame for the fiasco, the Sunday Times reports. Accountants have reported finding demands for multiple taxpayers when opening envelops addressed to another taxpayer, with private codes and other reference numbers included in the correspondence. “This is an absolutely astonishing blunder,” said George Bull from RSM. “HMRC makes much of relying on self-employed workers getting their tax bills right, but appears incapable of managing its own data.” In a letter to the Association of Taxation Technicians (ATT), HMRC said: “We sincerely apologise and recognise that this is not in line with our Charter standards. We take all aspects of protecting data very seriously so there has been a lot of activity to understand this incident and mitigate future risks.” HMRC said it had taken urgent action to ensure the data breach did not happen again: “If any agents receive any correspondence for incorrect clients, we would ask that they return them to HMRC.”

The Sunday Times, Business, Page: 12

CORPORATE NEWS – WEEKEND TO 25TH APRIL 2021

SUNDAY

Stanlow refinery reaches with HMRC

Essar Oil, which controls the Stanlow oil refinery in north west England, has struck a deal with HMRC on its tax liability. The refinery produces a sixth of the country’s petrol and diesel and has now been thrown a £400m lifeline by the taxman amid fears it could collapse. Industry sources confirmed the “time to pay” deal reached with HMRC has removed the risk of insolvency. International travel restrictions have reduced demand while poor margins for refining alongside market volatility caused operating losses for the company.

The Sunday Telegraph

Charities ration services as pandemic bites

Fundraising experts warn that charities will inevitably have to ration their services after the pandemic left them struggling for cash. Some small operations are suspending services leaving others to pick up the slack. The Sunday Telegraph notes that between April 2020 and February, the Charity Commission saw a 25% increase in concerns being raised by auditors over reports and accounts. The main issue reported was insolvency or financial difficulties.

The Sunday Telegraph

Tate & Lyle auctions off primary products division

Tate & Lyle has been working with Deloitte for some time to figure out the best way to spin off its primary products division, with Apollo Global Management and Cerberus among the interested parties. City sources say a £1.2bn auction for the division is now underway.

The Sunday Telegraph, Business, Page: 1

SMEs NEWS – WEEKEND TO 25TH APRIL 2021

SUNDAY

Small firms suffer cashflow woes just as support is withdrawn

The Sunday Times talks to small business owners who, after being devastated by the pandemic, face paying back Covid loans before their cashflow has been repaired. One businessman said: “The speed at which the Government thinks you’re able to start hurling money back at them is crazy.” Craig Beaumont, chief of external affairs at the Federation of Small Businesses said the issue was common, adding: “The Government should be throwing everything it’s got at getting businesses across this ‘unlock’ phase and into the recovery, to avoid businesses falling at the final hurdle because of lack of cashflow.” But Steve Russell, head of restructuring services at PwC, says VAT deferrals, the furlough scheme and emergency loans are “not gifts. They are support schemes that need to be unwound.”

The Sunday Times, Business, Page: 3

PERSONAL FINANCE NEWS – WEEKEND TO 25TH APRIL 2021

SUNDAY

Families increasingly using deed of variation

Irwin Mitchell solicitor Sarah Paton says there has been an uplift of families changing the wills of elderly parents after they pass to help younger generations hit hard by the pandemic. “A deed of variation can be used to give a fixed sum or a proportion of the estate directly to the grandchildren of the deceased instead of the children,” she explains. Mike Hodges, partner at Saffery Champness, points out that families often decide it is better to wait until after the death to work together to rejig the will, to save the loved one distress. Using a deed of variation can also reduce inheritance tax liabilities by shifting assets directly to a younger person’s estate.

The Mail on Sunday

PENSIONS NEWS – WEEKEND TO 25TH APRIL 2021

SATURDAY

Drop in pension income more startling than expected

With the closure of final salary pension schemes looming, Lane, Clark & Peacock believes the drop in pension income is going to be more startling than first thought. Its research suggests that the average man retiring this year will have an annual income of £14,634 and a woman £10,042, including state pensions. But by 2045, a man retiring would have an income of £12,460, and a woman £10,797, in today’s money. Female income improves because more are expected to be able to claim full state pensions. Public sector workers will suffer less because many will still have defined benefit pensions. Steve Webb, a former pensions minister and partner at LCP, commented: “For years, salary-related pensions from private sector jobs have supported the incomes of the newly retired, and men in particular. But these pensions are disappearing much more rapidly than we thought. And new-style workplace pensions are not being built up quickly enough to take up the slack.”

The Times

SUNDAY

PENSIONS

More action needed to close pensions gap

The Sunday Times warns that more needs to be done to close the pensions gender gap and promote equal pay in retirement. The paper reports that research from the Prospect union has found that the gap for pensions stands at 40.3%, more than double the gender salary gap of 15.5% reported by the ONS. The SNP MP Patricia Gibson said it was unacceptable that all types of pension inherently discriminate against women. It is noted that last week, Guy Opperman, the Pensions Minister, said there was a “clear passion” for making women better off in older age.

The Sunday Times

PROPERTY NEWS – WEEKEND TO 25TH APRIL 2021

SUNDAY

Tax deadline leads to frenzied market

House prices have rocketed over the course of the stamp duty holiday and there is a buying frenzy as the deadline looms, reports the Sunday Times. Figures from HMRC show almost 191,000 homes were sold in March – the highest number in a single month since July 2004. But the savings from the Chancellor’s tax cut have long since been cancelled out by property price rises, the paper’s Carol Lewis claims.

The Sunday Times, Page: 6

LEGAL NEWS – WEEKEND TO 25TH APRIL 2021

SATURDAY

Former subpostmasters cleared over accounting scandal

Almost 40 former subpostmasters who were convicted of theft, fraud and false accounting because of the Post Office’s defective Horizon accounting system have finally had their names cleared by the Court of Appeal. The Horizon system, developed by Fujitsu, was first rolled out in 1999 but from an early stage it appeared to have significant bugs that could cause the system to misreport. Horizon-based evidence was used by the Post Office to successfully prosecute 736 people. Lord Justice Holroyde said the Post Office “knew there were serious issues about the reliability of Horizon” and had a “clear duty to investigate” the system’s defects. But the Post Office “consistently asserted that Horizon was robust and reliable”, and “effectively steamrolled over any subpostmaster who sought to challenge its accuracy”, the judge added. In all, 39 of the 42 appeals were allowed on the grounds that the prosecutions were “an affront to the public conscience.” Lawyers for the group said they would be seeking compensation and an urgent criminal investigation into the actions of those at the Post Office.

The Daily Telegraph, Page: 11 BBC News The Times Daily Mail Evening Standard Daily Express, Page: 6

EMPLOYMENT NEWS – WEEKEND TO 25TH APRIL 2021

SATURDAY

Talent hunt kicks off as London firms launch hiring sprees

Financial services, legal, PR and construction companies across London are ramping up hiring with recruiters reporting a 349% jump in banking jobs advertised. But tech is driving job creation with KPMG’s quarterly tech monitor revealing that in the three months to March, UK tech sector firms hired staff at the fastest pace seen since the second quarter of 2019. Robert Walters’ UK managing director, Chris Poole, said: “March was incredibly busy for us. It almost felt like a line in the sand – it was incredibly busy across all sectors. Technology has been busy all the way through, but there has been a lot of pent-up demand within legal, within accountancy, within financial services. Even manufacturing, procurement, supply chain – it has been across the board.”

Evening Standard

FINANCIAL SERVICES NEWS – WEEKEND TO 25TH APRIL 2021

SATURDAY

Equivalence or no equivalence, London will stay financial services leader

KPMG ’s head of Financial Services Karim Haji has said if the UK and the EU fail to agree a deal on equivalence it won’t be the end of the world. Although it would “make life easier”, it was not mandatory for a successful financial services sector. “If you take a step back, the UK has been one of the leaders in financial services regulation and infrastructure, it’s one of the key innovators in the space as well, and one of the leaders in the world, and that’s why the UK has been successful in exporting financial services – that isn’t changing as a result of Brexit,” he continued. Mr Haji’s comments come after EU commissioner Mairead McGuinness said there was no pressure to reach agreement with the UK on financial services.

City AM Daily Express

ECONOMY NEWS – WEEKEND TO 25TH APRIL 2021

SATURDAY

UK economy rebounds with demand surging

Private sector activity grew at the fastest rate since November 2013 in April, hitting a reading of 60, according to IHS Markit’s purchasing managers’ index (PMI). This is up from 56.4 in the previous month and above the 58.2 forecast by economists. Service sector business activity rose from 56.3 to 60.1, while manufacturing output was up from 56.6 to 59.1. Chris Williamson, chief business economist at IHS Markit, said: “Companies are reporting a surge in demand for both goods and services as the economy opens up from lockdowns and the encouraging vaccine rollout adds to a brighter outlook.” Looking forward, Williamson added: “Business activity should continue to grow strongly in May and June as virus restrictions are eased further, setting the scene for a bumper second quarter for the economy.”

Financial Times The Daily Telegraph The Times The Guardian

UK retail sales jump

Data from the ONS show retail sales in Great Britain rose 5.4% in March compared with the previous month – a much stronger reading than the 1.5% forecast by economists. Sales of clothes was particularly strong rising by more than 17% while the easing of travel restrictions towards the end of the month led to an 11% increase in fuel sales. Howard Archer, chief economic advisor to the EY ITEM Club, said: “It does appear that many people were intent on having an enjoyable Easter break and this likely lifted retail sales later in the month.” Also commenting, Lisa Hooker, consumer markets leader at PwC, said: “Much though these figures will give cheer to the whole sector, retailers will be hoping that these positive signs translate into a sustained return to the physical stores as they reopen across the UK over the course of April. The real test of whether pent-up demand can be turned into actual sales w ill come with next month’s figures.”

Financial Times BBC News The Daily Telegraph The Guardian Daily Mail

Covid response pushes UK borrowing to highest since second world war

Figures from the ONS show UK government borrowing hit £303.1bn in the year ending in March, a jump of £246.1bn on the previous year when the figure was only £57.1bn. The coronavirus pandemic has driven the UK’s total accumulated public debt to £2.14trn, or 97.7% of GDP, the highest level since the early 1960s. As a percentage of national output, borrowing in the year between April 2020 and March 2021 stood at 14.5% – the highest since the financial year ending in March 1946. KPMG senior economist Michal Stelmach said rising debt was a consequence of shielding the economy from COVID-19.

Financial Times, Page: 2 The Daily Telegraph The Times The Times City AM The Guardian Daily Mail Daily Express, Page: 5

SUNDAY

Broadbent forecasts speedy recovery

The deputy governor of the Bank of England predicts “very rapid growth at least over the next couple of quarters” as Britons spend cash accumulated during the pandemic and save less of their forthcoming income. Ben Broadbent is more bullish than most of his Monetary Policy Committee colleagues on whether people will spend their savings but he warns that the year ahead is likely to be bumpy regarding inflation with multiple shifts in demand and supply.

The Sunday Telegraph

Contact Paul Southward

Paul Southward

NEWS – WEDNESDAY 14TH APRIL 2021

NEWS – WEDNESDAY 14TH APRIL 2021

NEWS ROUNDUP

TAX NEWS – WEDNESDAY 14TH APRIL 2021

UC claimants hit by tax raid

HM Revenue & Customs has cut payments to hundreds of thousands of Universal Credit (UC) claimants during lockdown because they were mistakenly overpaid tax credits as long as 17 years ago. As many as half a million struggling families have been affected. HMRC data shows such deductions have been occurring “at a rate of 47,000 cases per week” since January 18. Figures also reveal that between April and November last year it cut £63m from claimants’ payments. UC architect Sir Iain Duncan Smith said using the benefits system to claw back tax in this way is “a major mistake” that is “causing profound difficulties.”

The Times, Page: 15 The Times The Times

Wales – Labour vows ‘no income tax rise in Covid recovery’

Mark Drakeford has promised not to increase income tax while the economy is recovering from the impact of coronavirus if his party is re-elected into government at the Senedd election. The Welsh Labour leader pledged to create a “stronger, greener, fairer Wales” if in power after the 6 May vote.

BBC News

Denmark charges 3 Americans and 3 Britons in tax fraud scandal

Three British citizens and three US nationals have been charged by Danish authorities with defrauding Denmark of $175m as part of a European investigation into dividend tax fraud. The cum-ex trading scheme is also being investigated by authorities in Germany, Belgium and Britain.

Financial Times, Page: 10 Daily Mail

CORPORATE NEWS – WEDNESDAY 14TH APRIL 2021

Babcock in writedowns warning

Defence contractor Babcock has warned of writedowns totalling some £1.7bn, more than double analysts’ estimates, following a review of historic contracts and future income. In a trading update, the firm noted that the “vast majority” of impairments are one-off in nature and non-cash affecting, with group underlying operating profit expected to be reduced by around £30m annually. Babcock’s annual results are likely to be delayed because of the volume of work needed on the writedowns and write-offs and because the company effectively has two auditors as Deloitte prepares to take over from PwC.

The Times, Page: 33 Financial Times, Page: 12

Peacocks bidders had no chance, critics say

The Times reviews the move by Philip Day’s right-hand man to rescue Peacocks, with the backing of Day himself. The “phoenixing” of Day’s various retail interests in new vehicles fronted by Steve Simpson, his long-term lieutenant, has led to criticism. The Peacocks move infuriated rivals who have accused FRP Advisory, the administrators to Day’s assets, of “merely going through the motions, wishing to create the appearance of a fair and equal bidding process, when in fact they have a settled intention to compete with one particular party — an insider”. FRP insists it ran a full and fair process and rejects allegations that it had frustrated other bidders, such as Frasers Group’s attempts.

The Times

PENSIONS NEWS – WEDNESDAY 14TH APRIL 2021

Working from home can turbocharge women’s pensions

Former pensions minister Ros Altmann has welcomed the move to flexible working, adding that it will “alleviate” some of the pension discrepancies between men and women. She says: “The more women can combine their caring duties with their careers, the better. It is certainly a good thing if workplaces make it easier for women to continue working full-time hours while balancing their other responsibilities.” But, she adds: “Lots of women are still unable to commit to full-time hours even when flexible working is an option.”

Daily Mail This is Money

SMEs NEWS – WEDNESDAY 14TH APRIL 2021

HMRC gives update on SEISS payments

HMRC has issued an update on SEISS grants, stating that the service to claim the fourth grant will be available from late April 2021. HMRC said: “If you are eligible based on your tax returns, HMRC will contact you in mid-April to give you a date that you can make your claim from. It will be given to you either by email, letter or within the online service.” HMRC added that self-employed claimants will need to confirm they meet all the eligibility criteria when making their claim – which has to be made on or before June 1, 2021.

Daily Express

ECONOMY NEWS – WEDNESDAY 14TH APRIL 2021

Positive Covid data pressures Johnson to reopen faster

New official figures show 23% of recorded coronavirus deaths are now people whose primary cause of death was not COVID-19. Additionally, daily death figures by “date of death” reveal that Britain has had no more than 28 deaths a day since the beginning of April while Oxford University has calculated that the number of people in hospital with an active Covid infection is likely to be around half the current published daily figure. Covid deaths now make up just 4.9% of deaths registered in England and Wales, compared with 45% in mid-January, according to the ONS. MPs are now calling on Boris Johnson to take a less cautious approach to lifting restrictions to reduce the other harms caused by lockdown. Prof Carl Heneghan, the director of the Centre for Evidence Based Medicine at Oxford University, commented: “The issue is as we go about our daily lives there will be a slight increase in cases, but the key is not to panic. I think this over-cautiousness c an be overcome by using a data-driven approach.”

The Daily Telegraph

February export figures released

The Office for National Statistics has released figures showing that UK trade with the EU recovered in February, with exports increasing by £3.7bn, or 46.6%, after a £5.7bn decline a month earlier. AJ Bell financial analyst Danni Hewson commented: “There is small comfort to be had in February’s trade figures. Exports to the EU, which dropped so dramatically off a cliff in January, have bungeed back up, though they are still £2bn down on pre-Brexit levels. Notably imports from the EU were less resilient and remain more than £5bn down.”

The Daily Telegraph The Times Evening Standard

INTERNATIONAL NEWS – WEDNESDAY 14TH APRIL 2021

SEC says warrants issued by blank-check companies may be liabilities

The Securities and Exchange Commission has issued guidance indicating that the warrants issued to early investors in SPAC deals should not be classified as an equity, but rather “a liability measured at fair value, with changes in fair value each period reported in earnings.” In a statement late Monday, SEC officials said: “The evaluation of the accounting for contracts in an entity’s own equity, such as warrants issued by a SPAC, requires careful consideration of the specific facts and circumstances for each entity and each contract.” Forbes reports that uncertainty over how the SEC will treat warrants has stopped all new SPAC offerings as accounting firms will not sign-off on any financial statements or company audits until they receive clarity from the government.

Bloomberg Forbes Daily Mail City AM

US should require crypto-trading to be reported to help close tax gap

Internal Revenue Service Commissioner Charles Rettig estimates that the US now has a $1trn tax gap – up from the last official estimate of a $441bn annual average from 2011 to 2013. Rettig reckoned trading in cryptocurrencies was escaping taxation, as was rising foreign-sourced income and abuses of business income passed through as personal income. Among his recommendations Rettig suggested new legislation requiring transactions in cryptocurrencies such as Bitcoin be reported.

Daily Mail

OTHER NEWS – WEDNESDAY 14TH APRIL 2021

Katie Price owes £3.2m to creditors

Former glamour model Katie Price reportedly owes more than £3.2m to her creditors after accountants submitted a report raising concerns about her financial conduct. Price allegedly owes the cash from her company Jordan Trading Ltd, despite being declared bankrupt in 2019 and vowing to pay back £12,000 a month through an individual voluntary arrangement. The reality star was once worth more than £45m.

Daily Mail The Sun Daily Mirror

Bank of England’s chief economist to run Royal Society of Arts

Andy Haldane is leaving the Bank of England after a 30-year career to join the Royal Society for Arts, Manufactures and Commerce (RSA) as chief executive in September. The Bank of England’s chief economist has been among the most optimistic forecasters throughout the pandemic. “Haldane’s departure means the Bank of England is losing its major – and maybe only – current hawk,” said James Smith, economist at ING. “In theory, at the margin this tilts the committee towards a more favourable view on negative interest rates if more stimulus were needed, though we still think this is unlikely.”

Financial Times The Daily Telegraph The Times

Contact Paul Southward

Paul Southward

NEWS – TUESDAY 13TH APRIL 2021

NEWS – TUESDAY 13TH APRIL 2021

NEWS ROUNDUP

TAX NEWS – TUESDAY 13TH APRIL 2021

American CEOs say Biden’s tax hikes will slash wages, hiring and profits

A majority of CEOs in the US have said the Biden administration’s plans to hike corporation tax from 21% to 28% would have a “moderately” to “very” significant adverse effect on their company’s competitiveness. A Business Roundtable Survey found 98% of American CEOs believe the rate increase will stunt wage growth, weaken expansion, innovation and hiring. Raytheon Technologies CEO Gregory Hayes said: “The tax system needs to support innovation, R&D, capital investment and economic growth.” He continued: “As we look toward recovering from the COVID-19 pandemic, keeping competitive tax policies in place is needed to help reinvigorate the U.S. economy and lead to more opportunity for Americans.” Meanwhile, writing in the FT, Richard Murphy says Biden’s plan for international tax reform would need robust country-by-country reporting if it’s to stop international tax arbitrage. Finally, Conservative MP Sir John Redwood has warned that a new global minimum corporation tax rate of 21% would seriously harm investment flows into Ireland, which has used a 12.5% tax rate to build its economy.

Financial Times Daily Express Daily Mail

UN chief calls for wealth tax on rich boosted by pandemic

United Nations secretary-general Antonio Guterres has urged governments to impose a “solidarity or wealth tax” on rich people who profited during the coronavirus pandemic. “We must make sure funds go where they are needed most. Latest reports indicate that there has been a $5trn surge in the wealth of the world’s richest in the past year,” Guterres told a UN meeting on financing for development. “I urge governments to consider a solidarity or wealth tax on those who have profited during the pandemic, to reduce extreme inequalities,” he added. The call from Guterres follows a similar plea from the International Monetary Fund which has advocated a “temporary COVID-19 recovery contribution” to be levied on those companies and individuals that have benefited financially during the pandemic.

City AM Daily Mail The Independent

SMEs NEWS – TUESDAY 13TH APRIL 2021

City to boost Square Mile’s recovery with fund for SMEs

Catherine McGuinness, Policy Chair of the City of London Corporation, details in a piece for City AM a new Covid Business Recovery Fund to help underpin the Square Mile’s economic recovery. “The scheme is designed to support SME businesses which contribute to the Square Mile’s vibrancy at street level and directly provide services to returning City workers, visitors and residents.” McGuinness adds that most workers are keen to return to the Square Mile while City leaders have stressed their commitment to central London office space. She concludes: “The vibrancy of our unique ecosystem relies on each part of the City community – multinational businesses to domestic SMEs, international workers to local residents – working in partnership. Together we can bring back the buzz of life in the Square Mile.”

City AM

SMEs should use delays to customs changes to implement new systems

Experts are warning Britain’s small businesses to get systems in place so they can export smoothly to the EU whilst the rollout of new border procedures are delayed. Management consultant Neil McEvoy said: “Businesses need systems in place that provide scheduling and planning tools, in order to ensure every shipment is compliant when sent to the EU.” He added: “If SMEs get their selling systems ready for May they will survive, because Europe offers ‘low-hanging fruit’, with lots of people looking to spend. There will be many businesses that don’t and they will go to the wall. For those that get it right, the market is huge.”

The Loadstar

PENSIONS NEWS – TUESDAY 13TH APRIL 2021

Pandemic fuels ‘all-or-nothing’ retirement plans

Research from Hargreaves Lansdown shows the gap in peoples’ retirement plans has widened as a result of the COVID-19 pandemic. The investment platform found the number of people who wanted to give up work between the age of 50 and state pension age had more than doubled from 4% before the pandemic to 10% after. Conversely, for those that wanted to carry on working full time, the figure increased from 38% to 42%. Hargreaves’ Sarah Coles said the pandemic had forced people to make decisions about their retirement. “While a fifth of people still plan to gradually ease out of the workplace, it has fuelled a rise in all-or-nothing retirement plans,” she said. Meanwhile, Darren Dicks, head of wealth management at Age Partnership, said: “Since February we have seen a marked increase in the volume of clients getting their retirement plans back on track.”

Daily Express Investors’ Chronicle FT Adviser Pensions Age

Cost risk for NHS if retirement age extended

A study of more than 7,000 women aged 55 to 65 out of King’s College London warns that raising the retirement age as a means to reduce pension costs would mean a reduction in in-family care resulting in more pressure on the NHS. Research fellow Ludovico Carrino said longer working hours cut the probability of women providing “intensive” or “meaningful” care and urged officials not to consider policies in institutional silos. Sir Steve Webb, former pensions minister and partner at consultants LCP, said: “If governments are going to raise pension ages, much more needs to be done to support people who will be working longer as a result.” The Telegraph notes that the state pension age for men and women will rise to 67 by 2028 with recent increases saving the Government billions of pounds every year.

The Daily Telegraph

CORPORATE NEWS – TUESDAY 13TH APRIL 2021

Liberty Steel misses filing deadlines

Liberty Steel has failed to file accounts for some of its biggest British businesses in time. Sanjeev Gupta is urgently seeking finance to shore up his industrial empire after its main backer, Greensill Capital went bust. Credit Suisse, a lender to Greensill, is trying to recover money lent to Gupta’s companies via court action in the UK and Australia. An insider said most of the companies had not filed audited accounts for the year ending on 31 March 2020 because they would no longer represent an up-to-date view of the businesses.

The Guardian, Page: 26

Taxpayers on the hook for Monarch airlift

papers released by KPMG show Greybull, the owner of collapsed budget airline Monarch, lost £25m from the administration process, which was completed last month. The Civil Aviation Authority was forced to charter planes to fly customers back to the UK after Monarch went bust in 2017 and it was hoped some of the costs of the airlift could have been recouped, but tax payers will have to foot the entire £60m bill.

Daily Mail, Page: 79

ECONOMY NEWS – TUESDAY 13TH APRIL 2021

North West business leaders optimistic

With coronavirus restrictions lifting across the country allowing hospitality and non-essential retail to open up again, leaders from across the North West are looking ahead with optimism. Neil Sturmey, a senior partner at Grant Thornton in the North West, noted that it had been “the longest winter” for high street retailers and the hospitality sector, with both “overdue some good news”. “That is coming,” he said. “Most of us are desperate to go out again and many businesses are hoping that we are heading for a golden summer.”

Insider Media

OTHER NEWS – TUESDAY 13TH APRIL 2021

KPMG UK appoints new chief executive

Jon Holt has been voted in as KPMG UK’s new chief executive with partners overwhelmingly backing the appointment, although he was the only candidate put forward by the board. The vacancy was created by the resignation by Bill Michael as chair and chief executive after a staff backlash in February over comments he made at a virtual town hall meeting. Mary O’Connor, who took over the day-to-day running of KPMG on an interim basis after Michael left, will now step aside. The firm’s chair Bina Mehta commented: “I’m delighted that Jon received the overwhelming backing of the partnership. Jon’s extensive experience and inclusive leadership style means he is well placed to deliver the next stage of our growth strategy and support our clients as the country emerges from the pandemic.”

Financial Times, Page: 12 The Daily Telegraph The Times, Page: 40 City AM Daily Mail, Page: 79 The I, Page: 44

City executive justly fired

An associate director at investment management company Smith & Williamson Corporate Services was sacked fairly, a tribunal has heard, after he gave a colleague a “seven out of ten” rating on a night out. Tom Skinner asked his junior colleague Jessica Lennox what would happen if they were the last people left alive and had to “repopulate the Earth.” During the same evening, he also made inappropriate comments to a woman named as ‘Ms J’ and twice followed her into the toilet and refused to leave. After he was sacked for gross misconduct, he launched an unfair dismissal claim, saying he had been discriminated against because he suffered from anxiety. His case was dismissed by a central London tribunal that ruled his “inappropriate behaviour” meant his sacking was justified.

The Times, Page: 18 The Daily Telegraph, Page: 13 Daily Mail, Page: 32 Daily Star, Page: 15 Daily Express, Page: 21

Contact Paul Southward

Paul Southward

NEWS – WEEKEND TO 11TH APRIL 2021

NEWS – WEEKEND TO 11TH APRIL 2021

NEWS ROUNDUP

TAX NEWS – WEEKEND TO 11TH APRIL 2021

SATURDAY

US tax plans could prove costly for British businesses

Although UK officials have welcomed moves by the Biden administration to force multinationals to pay more tax, the Treasury is urgently reviewing how the plans might affect UK businesses. The Telegraph reports that there is concern in Whitehall that British companies could end up paying more elsewhere in the world as a result of the proposals, potentially reducing revenues for the Exchequer. Washington’s plans would see a global minimum corporation tax and levies for companies based on the location of their sales. While tax campaigners and the Labour party urge the Chancellor to publicly back the plan – Tax Justice UK estimates the blueprint would bring in an extra £13.5bn a year for the public purse – Suren Thiru, head of economics at the British Chambers of Commerce, said while a co-ordinated international approach to addressing tax avoidance is preferable to a disjointed nation by nation approach, “significant questions remain on how it would work in practice.” In the FT, DeAnne Julius says Biden’s plans are brave and bold and could save companies a lot of time in tax planning.

The Daily Telegraph, Page: 35 Financial Times, Page: 11 The Guardian, Page: 42 The Times, Page: 53

One in ten cheques from HMRC not cashed

HMRC has said that nearly 3.8m cheques sent to taxpayers between 2015 and 2020 have not been deposited in accounts, amounting to a tenth of all tax rebates sent by post over the period. Less than 2% of tax refunds are made by cheque, according to HMRC, which said it pays money into people’s bank accounts directly where possible.

The Times, Page: 57

SUNDAY

Could global tax reform at last be within reach?

Several sources cover news of the Biden administration’s corporation tax proposals with the FT reporting that the political battle lines in the US are being formed with many Republicans on Capitol Hill warning that the changes could harm US multinationals while two of the most influential Democratic lawmakers on tax policy have backed the plans. Elsewhere, the Observer’s business leader argues that the move from Washington has raised hopes of a breakthrough for a global agreement on tax and describes the proposals as a change that could make the world a fairer place and “kill tax havens dead”.

Financial Times The Observer, Page: 56

No IHT for Philip’s bequests, unless you’re a minor royal

The Sunday Times reports that due to a deal struck with former PM John Major bequests from Prince Philip to the Queen, the Prince of Wales and the Duke of Cambridge will be tax-free. However, anything from the Duke of Edinburgh’s estate which is passed to his other children or grandchildren, including his second son, the Duke of York, and the Duke of Sussex, would be taxed at the standard 40%, above the £325,000 threshold. The “sovereign to sovereign” rule was negotiated with the Conservative government in 1993 when the Queen and the Prince of Wales first agreed to pay income tax.

The Sunday Times, Page: 4

CORPORATE NEWS – WEEKEND TO 11TH APRIL 2021

SATURDAY

Suspect Sanjeev Gupta invoices used in Greensill loans raise fraud concerns

Several European metals companies have denied doing business with Sanjeev Gupta’s Liberty Commodities, raising questions over invoices purporting sales to the businesses which formed the basis of funding from Greensill Capital. Separately, the collapse of Greensill has led to 440 staff losing their jobs, administrators have revealed. Grant Thornton said 305 redundancies would be made at the firm’s head office in Warrington, with the rest in London.

Financial Times, Page: 1 BBC News

John Lewis chief says no more store closures expected

Pippa Wicks, John Lewis’s chief executive, has insisted there will be no further shop closures, as she defended the partnership’s revival strategy two weeks after shutting eight outlets. The Times cites analysis by PwC which shows nearly 99m sq ft of retail space has closed in the past year while 5,500 out of 30,000 non-essential retail stores remained closed between the three lockdowns and may never reopen.

The Times, Page: 49 The Daily Telegraph

Frasers Group to take £200m Covid hit

Mike Ashley’s Frasers Group is anticipating a £200m hit due to coronavirus, warning that further restrictions on retail are “almost certain”. Chris Wootton, chief financial officer, said the additional writedown had not been the result of pressure from RSM, its new auditor, and that the decision had not been reviewed by RSM although the group had informed the firm before telling investors.

The Daily Telegraph The Times, Page: 50 City AM The Guardian

Brooks Brothers UK enters administration

The British division of US clothing retailer Brooks Brothers has entered administration, after suffering from a lack of demand for its products as people worked from home. Begbies Traynor has been appointed as the company’s administrators.

City AM

SUNDAY

Italian consortium to bid for National Lottery

The Sunday Telegraph reports that investment firm CVC Capital Partners is backing a bid to run the National Lottery led by portfolio company Sisal, the operator of Italy’s most popular lottery. The bid will be made in conjunction with children’s charity Barnardo’s, which will provide expertise on raising money for good causes in the UK. The Sisal-led consortium is attempting to displace incumbent operator Camelot, which has run the National Lottery since its launch more than a quarter of a century ago. The auction is being run by Rothschild, EY and Hogan Lovells on behalf of the Gambling Commission and is scheduled to culminate this autumn.

The Sunday Telegraph, Business, Page: 4

Day accused of manipulating Peacocks rescue

The Sunday Times reports on claims that Philip Day engineered the administration of his Peacocks business so it ended up being bought by Steve Simpson, his closest lieutenant. The paper’s Sam Chambers says the deal has ensured the key components of Day’s Edinburgh Woollen Mill Group have ended up being controlled by Simpson and that other suiters had no chance, leaving questions for advisers from FRP Advisory and RSM.

The Sunday Times, Business, Page: 5

SMEs NEWS – WEEKEND TO 11TH APRIL 2021

SUNDAY

Scotland’s entrepreneurs need vision and investment

Gillian Bowditch says in the Sunday Times that Scotland’s small businesses need investment from the Scottish government and leadership from Scottish Enterprise – an organisation she says, “has proved to be a bloated and inefficient body that ought to be disbanded.” SMEs are the key to economic growth and instead of dreaming about unicorns, Nicola Sturgeon’s government should recognise that uncertainty over independence makes business leaders nervous and red tape ties up entrepreneurs: what’s needed is “vision, courage and calculated risk” or there is little hope for economic growth.

The Sunday Times

Optimism returns for small businesses

A report from Hitachi Capital shows confidence among small businesses has returned to pre-pandemic levels, with 36% of business owners predicting they will grow during the second quarter, up from just 14% a year ago. The percentage fearing collapse has also fallen from 29% over the past year to 7%.

Sunday Express, Page: 59

FINANCE NEWS – WEEKEND TO 11TH APRIL 2021

SUNDAY

Banks prepare to claw back billions in Covid loans

HSBC, NatWest, Barclays and Lloyds have begun writing to businesses warning them that repayments on emergency support loans will soon be expected. Banks have handed out more than £75bn to 1.6m firms under a number of schemes set up by Rishi Sunak, the Chancellor, and are expected to spend millions on recovery. One senior banker warned that lenders could go in hard to recover debts after a recent court case found banks do not have a duty of care to borrowers who fail to repay.

Daily Mail

PENSIONS NEWS – WEEKEND TO 11TH APRIL 2021

SATURDAY

Pension schemes take legal action over reformulation of inflation measure

Trustees of the Ford, BT and Marks and Spencer pension schemes are seeking a judicial review of the decision to change the calculation of inflation, which they say will leave millions of retirees with lower annual payouts. The Government’s recent decision to align the Retail Prices Index (RPI) with the Consumer Prices Index including owner occupiers’ housing costs (CPIH) will have “far-reaching implications” which have not been “fully considered” by officials, the trustees argue. The reform is also seen as likely to lead to an increase in scheme funding shortfalls because it reduces the value of RPI-linked assets. This in turn would add pressure on sponsoring employers, the trustees pointed out.

Financial Times Pensions Age Investment & Pensions Europe

SUNDAY

How to get your own £7,000 state pension bonanza

The Telegraph reveals how pensioners were able to recoup thousands of pounds of pension underpayment after reaching out to Sir Steve Webb, the former Pensions Minister. Figures released last week by the Office for Budget Responsibility revealed the average arrears payment for the first time. More than 74,000 married women are to receive up to an average of £23,000 over the next five years, while widowed retirees are owed an average £17,000. Sir Steve, who has led the campaign resulting in thousands of women applying for back payments, said: “While it is good news that some married women will now be contacted and awarded an increased pension as part of the DWP’s exercise, even this group may have to wait up to five years to be put on the right rate.”

The Daily Telegraph

Britons may have to work an extra four years before retirement

Experts have suggested a recent study concluding that the average retirement age has risen from 64 to 66 may be off the mark by four years or more. Neil Moles, CEO of financial advice firm Progeny, says his research indicates “people are expecting to work for up to two years more, however, we could be looking at three, four or more years longer than this for many people.” Moles suggests this is a result of fears over high levels of government debt and future tax hikes, as well as concerns over looking after other family members after they retire.

Sunday Express

PROPERTY NEWS – WEEKEND TO 11TH APRIL 2021

SATURDAY

House prices expected to continue rising

Figures from Halifax on Friday show house prices rose 1.1% during March, the biggest increase in six months. In annual terms, prices rose 6.5%, the strongest reading in four months and taking the average house price to a record high £254,606, Halifax said. The lender added that it expected the upturn to persist in the next few months as consumer confidence grows on the back of Britain’s swift COVID-19 vaccine rollout. “However, with the economy yet to feel the full effect of its biggest recession in more than 300 years, we remain cautious about the longer-term outlook,” Halifax added.

Daily Mail

Property developer boss says workers must return to the office

Land Securities CEO Mark Allan is urging the Government to change its guidance that states people should continue work from home if they can until June at the earliest. A safe return to the office should be accelerated if we are to see economic activity in Britain’s cities revived, Allan said. His comments come as employers including HSBC, Lloyds, Grant Thornton and PwC have said they will slash office space after the pandemic recedes.

Daily Mail, Page: 91

SUNDAY

NCP’s landlords gear up for battle over restructuring plans

Landlords are fighting back against demands from Japanese-owned car park operator NCP that substantial rent arrears are written off. Sky News reports that a group of landlords is said to be lining up AlixPartners and Hogan Lovells to advise them in a bid to overturn NCP’s proposals. Melanie Leech, the chief executive of the British Property Federation, said: “This Restructuring Plan, if approved, will signal to businesses that they can use this new business rescue procedure to simply walk away from debt owed to property-owners […] who represent local authorities and millions of pensioners and savers invested in commercial property, to a business’ shareholders.” NCP, which is being advised by Deloitte, has warned that it is likely to collapse unless the restructuring is implemented.

Sky News

EMPLOYMENT NEWS – WEEKEND TO 11TH APRIL 2021

SATURDAY

Furlough fraud cases rocket

The Express reflects on the creation of a taskforce to claw back cash lost to furlough fraud during the pandemic. Official figures from HMRC show reports of furlough themed fraudulent activity have risen to just over 26,000; at the time of the Budget HMRC had 10,000 live inquiries. Iskander Fernandez, Head of White Collar Crime and Investigations at BLM, said of the Chancellor’s £100m funding for the taskforce that it may be considered “a conservative sum given the potential scale of fraud.”

Daily Express

SUNDAY

MPs call for fairness as IR35 changes rolled out

The All Party Parliamentary Loan Charge Group has called for off-payroll reforms currently being rolled out to be re-examined during the passage of the Finance Bill this year. A report from the group stated that: “All ‘inside IR35’ workers should get full rights under all legislation dealing with agency workers, with a clear and transparent right to holiday and sick pay.” The APPG recommended an alignment of tax and employment law to ensure fairness, declaring: “We call on the Government to accept it is unfair for workers who are taxed as employees to be denied the rights and benefits of an employee or recognition in employment law. Anyone who is taxed as an employee should also receive the corresponding benefits; thus, by aligning tax and employment law, certainty for both contractors and hirers will ensue.”

Sunday Express

ECONOMY NEWS – WEEKEND TO 11TH APRIL 2021

SATURDAY

Consumers chomping at the bit

Experts are predicting a spending spree next week as shops reopen on what is being dubbed as “Bounceback Monday”. Analysts predict £4.5bn could be spent in the first seven days of post-lockdown shopping with Lisa Hooker, head of consumer markets at PwC, saying: “You will see a big bang, particularly if the weather is good. There is enormous pent-up demand. Retailers were quite cautious when we came out of lockdown last year but this time there is far more excitement.”

Daily Mail, Page: 43

Trade with France returns to pre-Brexit levels

March saw trade between the UK and France return to pre-Brexit levels raising hopes of a swift recovery as businesses get to grips with customs arrangements. Analysis by French customs officials shows imports from Britain climbed to 107% of typical levels after taking Covid effects into account, the research found – with exports back at 96%.German figures for February also showed improvement with the sharp slump witnessed in January shrinking markedly. However, trade experts said Anglo-German trade is still struggling badly with exporters hit particularly hard.

The Daily Telegraph

SUNDAY

Take care of emerging markets, your future depends on it

The International Monetary Fund warned last week that the multi-speed recovery from the pandemic was leaving developing nations behind. The worst-hit countries will be emerging Asian economies which could suffer a near-8% loss in GDP by 2024 compared to pre-Covid projections. The US, by comparison, will be larger by 2024 than it would have been if Covid had never hit. “Last year, everyone spent like crazy, it was a big widening of fiscal deficits everywhere in advanced economies and in emerging markets,” explains Marcelo Carvalho, head of global emerging markets research at BNP Paribas. “The difference is the room for manoeuvre; the fiscal space is more limited for emerging markets. In advanced economies, you can print your own hard currency, it’s not the case for emerging markets.” The Telegraph’s Tom Rees concludes: “Advanced economies could soon put Covid in the rear-view mirror but for many poorer countries a longer, rougher road to recovery lies ahead.”

The Sunday Telegraph

INTERNATIONAL NEWS – WEEKEND TO 11TH APRIL 2021

SATURDAY

Wall Street investors look warily at gathering tax ‘storm’

While many laud President Joe Biden’s corporation tax plans, analysts are warning they pose a serious risk to profit margins for US companies and could derail hiring plans. As if to illustrate the point, the Times reports on an exodus of millionaires from New York to Florida and Texas as tax rises threaten a drastic reduction in the city’s tax receipts.

Financial Times, Page: 17 The Times, Page: 44

Contact Paul Southward

Paul Southward

NEWS – FRIDAY 9TH APRIL 2021

NEWS – FRIDAY 9TH APRIL 2021

NEWS ROUNDUP

TAX NEWS – FRIDAY 9TH APRIL 2021

US offers new plan in global corporate tax talks

Washington has suggested multinational companies to pay levies to national governments based on their sales in each country as part of proposals for a global minimum tax. The Biden administration’s plans would subject about 100 of the world’s biggest multinationals, including the tech giants like Google, Apple, Facebook, Microsoft and Amazon, to a regional tax settlement while a global minimum tax rate would mean reduced tax competition between states. Pascal Saint-Amans, head of tax administration at the OECD, welcomed the US proposals. “This reboots the negotiations and is very positive,” he said. The Telegraph reports that Ireland, the Netherlands, Luxembourg, Switzerland, Singapore and the Caribbean will be the biggest losers from the plan. Goldman Sachs economist Jan Hatzius says the move illustrates how much Biden plans to rely on taxing foreign profits for new tax revenue while Chris Sanger, head of tax policy at EY asserts that any policy that ends profit shifting is likely to be good for the UK as it “benefits those countries with a large consumer base”.

Financial Times, Page: 1 Financial Times, Page: 22 The Times, Page: 22 The Daily Telegraph, Business, Page: 5 The Guardian, Page: 2, 33 The Times, Page: 32 Daily Mail, Page: 2

CORPORATE NEWS – FRIDAY 9TH APRIL 2021

Construction activity hits seven-year high

IHS Markit’s construction Purchasing Managers Index for March registered 61.7, as construction output increased at the fastest rate in six and a half years. Steve Plaskitt, partner at MHA, commented: “The spring budget was a boon for both house buyers, who stand to benefit from the extension and phased ending of the Stamp Duty holiday, and house builders, who will hope that the government’s guaranteed support for 95% mortgages until the end of 2022 will drive demand.” Elsewhere, Howard Archer from EY ITEM Club noted that civil engineering’s return to growth was particularly impressive following three consecutive months of contractions.

The Daily Telegraph City AM

Lookers enjoys sales boom

Car dealer Lookers said it would smash profit forecasts following a lockdown sales boom. The Mail notes that the Financial Conduct Authority has closed an investigation into the group – but the Financial Reporting Council is looking into Deloitte’s audits of the company. Mark Raban, chief executive of Lookers, said: “The events of the last year have highlighted the inherent strength of our franchised dealership model and the importance of an integrated customer experience which fully embraces both digital and physical channels.”

The Times, Page: 40 Daily Mail

SMEs NEWS – FRIDAY 9TH APRIL 2021

Small businesses supported by venture capital fundraising

Ian Sayers, chief executive of the Association of Investment Companies has spoken out on how the coronavirus crisis has affected fundraising for smaller companies, noting that “It’s really positive that during the pandemic 11% more was raised to support the UK’s most innovative and fast-growing businesses than the year before.” With venture capital trusts raising £685m last year to support such firms, he remarked: “This investment will support healthcare, science and technology businesses which have helped in the battle against coronavirus and supported us to adapt to life in lockdown. It demonstrates that demand for VCTs and the benefits they bring investors remains high at an extremely difficult time.”

City AM

City offers support for SMEs

The City of London Corporation will on Monday launch a £50m Covid Business Recovery Fund designed to support SMEs which directly provide services to returning City workers, visitors and residents. Grants will be based on individual requirements after a financial evaluation but will not exceed £100,000 per business. Policy Chair at the City of London Corporation, Catherine McGuinness, said: “Many City businesses are preparing to reopen their doors next week and start welcoming back customers. This will be a welcome return to a semblance of normality but inevitably some SMEs that have struggled during the pandemic will need support to get back on their feet.”

The Times, Page: 40 City AM

PROPERTY NEWS – FRIDAY 9TH APRIL 2021

House sales surge after stamp duty extension

House sales picked up in March after signs that the extension of a stamp duty holiday had an immediate impact, the strongest surge since last August. Half of property professionals reported an increase rather than a decrease in agreed sales, the Royal Institution of Chartered Surveyors (Rics) said. Simon Rubinsohn, of Rics, said: “All key activity indictors rebounded in March. Demand is outstripping supply so prices go upwards.” The pick-up also boosted expectations that sales activity will increase over the next three months, with 35% of surveyors predicting an uptick – the most upbeat reading on this measure since January 2020.

The Times The Daily Telegraph Daily Mail

PENSIONS NEWS – FRIDAY 9TH APRIL 2021

Thousands of married women could be owed millions

The I follows up on the news that thousands of married women could be owed by millions by the DWP because of underpayment. Former pensions minister Sir Steve Webb, who has been investigating this issue, said that the “scale of these underpayments is shocking” and urged the Government to repay women as a “matter of urgency”.

The I

ECONOMY NEWS – FRIDAY 9TH APRIL 2021

Fashion retail sales soared in March

Total like-for-like fashion sales jumped 57.5% in March – from a base of minus 25.9% in the same month last year. Sophie Michael, head of retail and wholesale at BDO, said: “Sales have improved, without a doubt, as retailers have found ways to adapt to lockdown. From virtual assistants to live video sales appointments, retailers have found technological solutions to drive sales, instead of simply shutting down like they did last year. However, as last March’s result was so disastrous, these results simply look better on paper as they’re set against such a poor base.” Separately, according to a survey by Deloitte, 56% of shoppers will feel safe about coronavirus risks when heading out to the high street next week, a 16 percentage point increase compared to last month.

City AM The Sun, Page: 47

FTSE rebounds to new post-pandemic high

Growing optimism as the economy reopens pushed the FTSE 100 to its highest level since the beginning of the pandemic on Thursday, rising 56.9 points to 6,942.22. The FTSE 250 rose to another all-time high following a top performance on Wednesday. Michael Hewson, chief market analyst at CMC Markets commented: “While other major indices have led the way in posting record highs in recent weeks, UK stocks appear to be finally finding favour with investors as an economic reopening beckons.”

The Daily Telegraph Evening Standard, Page: 22

INTERNATIONAL NEWS – FRIDAY 9TH APRIL 2021

An end to ECB bond buying poses risk to weaker eurozone economies

Experts warn that heavily indebted eurozone countries such as Italy and Greece face mounting debt costs after the pandemic – a situation that could unnerve investors and drive up interest rates. M&G fund manager Eric Lonergan said: “Europe is ironically vulnerable to recovery because it seems you only get temporary elimination of credit risk in European sovereigns when you are in an emergency, in which case the ECB underwrites your bond market. The problem is that when you come out of an emergency, you are back to market forces in the bond market, and some of these numbers look really, really bad.” Italy was particularly exposed, Mr Lonergan added, because the interest rate on its debt was higher than its rate of GDP growth.

The Daily Telegraph Daily Express

OTHER NEWS – FRIDAY 9TH APRIL 2021

UK businesses consulted on prolonged social distancing in offices

The Government has been consulting with professional services firms and other businesses over the long-term use of masks in offices and six months more social distancing as they make arrangements for the economy to reopen.

Financial Times

Contact Paul Southward

Paul Southward

NEWS – THURSDAY 8TH APRIL 2021

NEWS – THURSDAY 8TH APRIL 2021

NEWS ROUNDUP

TAX NEWS – THURSDAY 8TH APRIL 2021

CIOT and ICAS call for increased tax awareness

Accounting bodies in Scotland have called on the country’s political parties to improve public understanding of the devolved tax system. The plea comes as a new poll reveals that a third of Scots don’t know the Parliament has changed their taxes. The Chartered Institute of Taxation (CIOT) and the Institute of Chartered Accountants of Scotland (ICAS) have also called for increased scrutiny of tax by MSPs with the introduction of an equivalent to the Westminster Finance Bill, which would make changes to the tax system easier and more visible. The organisations make the call in a new paper, Building a Better Tax System, after a recent poll found that 33% of Scots said they were unaware that the Scottish Parliament had made changes to the tax system since 2015 and 26% said they were “not aware” the Scottish Parliament even had the power to make changes to income tax rates.

The Scotsman

IMF proposes ‘solidarity’ tax on pandemic winners and wealthy

Companies that prospered during the coronavirus crisis and wealthy people should pay a temporary additional tax to show solidarity with those who were hit hardest by the pandemic, according to the International Monetary Fund (IMF). The idea of a wealth tax has been revived by growing intergenerational inequality and the blow dealt to public finances by the pandemic, with the IMF warning that average government debt will hit 99% of GDP in 2021. But Helen Miller, deputy director at the Institute for Fiscal Studies, warned that although there was a case for a one-off wealth tax but cautioned it would not help tackle a higher structural deficit caused by Covid.

Financial Times, Page: 8 The Daily Telegraph, Business, Page: 2 The Times, Page: 31 Daily Mail

Global minimum tax rate gains traction

A global minimum tax on corporate profits is being considered by G20 finance ministers after the Biden administration made the case for an international base rate this week. According to Reuters, France and Germany have signalled support for the US approach, which could pave the way for a landmark agreement on global tax changes this summer. Sky News points out that may countries will not be keen on the idea, with the Republic of Ireland likely one of them. Ireland currently has a corporate tax rate of 12.5% and has attracted more than 700 companies from the US alone as a result of the policy.

Financial Times The Guardian, Page: 26 Sky News Daily Mail

PENSIONS NEWS – THURSDAY 8TH APRIL 2021

Women could be owed ‘lottery-winning’ pension sums

The BBC has learned that women on £1-a-week state pensions could be owed tens of thousands of pounds. A case study highlights the case of Carole Davies. Ms Davies is among 5,000 women entitled to potentially huge refunds, many of whom will not be captured by the DWP’s search, due to a rule change in 2008. Steve Webb, a former pensions minister said under a little-known rule, the women who qualify for this concession are those who are getting a tiny amount of what is known as “graduated retirement benefit” (GRB) under the old state pension system, which ran until 1975. The average amount they are receiving is around £1.24 per week, but this is enough to qualify for a married woman’s pension. They can backdate their claims to their husband’s 65th birthday and could be in line for tens of thousands of pounds. “It is incredible that there are thousands of women getting such tiny pensions, but even more incredible that many could potentially be entitled to tens of thousands in back payments,” said Mr Webb.

BBC News

EMPLOYMENT NEWS – THURSDAY 8TH APRIL 2021

Solid rebound will attract foreign workers back to Britain

International workers could flood back to Britain if the vaccine rollout encourages a more rapid reopening of the economy, Steffan Ball, an economist at Goldman Sachs said. “If jobs open up sooner in the UK than in the home countries of migrants who have recently left, then this would act as a strong force for them to return.”

The Daily Telegraph

CORPORATE NEWS – THURSDAY 8TH APRIL 2021

Serco practice of moving profits within group ‘legitimate’, lawyer says

A court hearing a case brought against Serco alleging fraud heard the company’s lawyer argues that transferring profits between its business units was “not very admirable” but “lawful … legitimate accounting”.

Financial Times, Page: 12

SMEs NEWS – THURSDAY 8TH APRIL 2021

BDO releases new survey results

BDO ’s latest Rethinking the Economy survey reveals that some 40% of North West businesses are planning major investment and hiring activities this year. Ed Dwan, partner and head of BDO in the North West, remarked: “It’s clear that as government restrictions start to loosen and the UK’s COVID vaccine programme continues to help suppress the virus, North West businesses are gaining the confidence needed to make key strategic decisions in the months ahead. Mid-sized businesses will play an integral role in the UK’s overall economic recovery.”

Insider Media

ECONOMY NEWS – THURSDAY 8TH APRIL 2021

Hiring picks up as lockdown lifts

Employers stepped up their recruitment plans last month as companies prepared for the national lockdown to ease. A survey on employers by the Recruitment and Employment Confederation and KPMG found hiring activity picked up at its fastest pace in almost six years in March. Permanent starting salaries increased while temporary salaries also rose at the fastest rates since December 2019. Neil Carberry, chief executive of the REC, said: “This is the first month that we have really seen things getting better for most firms. We are at the bottom of the mountain and starting to climb up again.” The survey showed that the strongest growth in vacancies was for nursing and care jobs, and in the IT sector while hospitality businesses were starting to hire again. There was, however, weaker demand in the retail sector.

The Times, Page: 34 Financial Times, Page: 2 The Daily Telegraph, Business, Page: 2 The I, Page: 9 Daily Mail The Independent

Confidence hits 15-year high

Business optimism is at its strongest since late 2006 according to the latest IHS Market PMI survey, with just 8% of companies predicting a fall in activity over the next twelve months. Britain’s overall PMI rose to 56.4 in March, reflecting a resurgence in services sector activity after several months of slowdown. Separately, high street footfall was up 134% over Easter weekend compared to this time last year despite non-essential shops not being open yet. Meanwhile, figures from PwC show that consumer confidence is now at its highest level since the tracking of the data began in 2008. PwC says the figures show there are consumers with more disposable income and “a pent-up demand to spend after a year of lockdown restrictions”.

The Daily Telegraph, Business, Page: 2 BBC News Daily Express

OTHER NEWS – THURSDAY 8TH APRIL 2021

Malaysia ex-PM served with bankruptcy notice

Najib Razak, the former prime minister of Malaysia, has been served with a bankruptcy notice for failing to pay more than $400m in unpaid taxes, a move that the ex-premier described as an attempt to destroy his political career.

Daily Mail

Contact Paul Southward

Paul Southward

NEWS – TUESDAY 30TH MARCH 2021

NEWS – TUESDAY 30TH MARCH 2021

NEWS ROUNDUP

TAX NEWS – TUESDAY 30TH MARCH 2021

US threatens tariffs on UK goods over digital services tax

The United States has threatened the UK with tariffs of up to 25% on a slew of goods in retaliation for the digital services tax. Brought in last April it levies at 2% the revenues of search engines, social media services and online marketplaces which derive value from UK users. Ceramics, make-up, overcoats, games consoles and furniture could all be hit, according to a list published by the Biden administration. A UK Government spokesperson said: “Like many countries around the world, we want to make sure tech firms pay their fair share of tax. Our digital services tax is reasonable, proportionate and non-discriminatory. It’s also temporary.” The FT reports that the UK international trade secretary, Liz Truss, has told the Biden administration to “desist” from its threat and instead engage in international efforts to agree a “fair” way to tax multinational tech companies.

The Daily Telegraph, Business, Page: 2 Financial Times The Guardian Daily Mail The Times, Page: 34 The I, Page: 4

Further tax changes expected

Industry experts speculate on the possible tax changes that Chancellor Rishi Sunak could announce in the Autumn Budget. Eddie Grant, a Director at St. James’s Place, comments: “The Government has over the year commissioned a series of consultations so there was an expectation they would be the focus of the Tax Day announcements, in particular Inheritance Tax and Capital Gains Tax, but there was only minor changes. There were no announcements about pension tax relief despite it being widely speculated and no changes to Capital Gains Tax. Could these be planned for the Autumn Budget when we get the detail?”

Daily Express

Isle of Man offers tax cuts to lure new residents

New residents are being encouraged to move to the Isle of Man and buy property amid a skills shortage in the economy. The island’s campaign is highlighting no inheritance tax, no stamp duty, no masks and no social distancing as some of the perks to entice prospective residents.

The Daily Telegraph

FINANCE NEWS – TUESDAY 30TH MARCH 2021

UK bank lending leapt by £29.3bn since March

A new study by UHY Hacker Young shows UK banks have lent around £29.3bn more to businesses over the past year – a rise of 8% since the start of the pandemic. This compares with a 5.3% jump in lending in the EU on average. UK bank lending also surpassed Germany (7%) and Spain (3%). “We may have underperformed in some areas in our response to Covid but in terms of getting finance to businesses, this is an area where the UK has been a leader,” managing director of UHY Hacker Young Corporate Finance, Robert Kidson, said. “The economic impact of the pandemic and the disruption to businesses cash flows has lasted longer than anyone expected…there is little certainty on when businesses can return to ‘normal’ operating levels, the UK needs to provide as much support as possible to ensure businesses stay afloat until then.”

City AM

SMEs NEWS – TUESDAY 30TH MARCH 2021

SMEs plan to increase investment in the year ahead

A report from Virgin Money reveals the annual growth rate in the number of registered companies in the UK surged to a record 8.3% in Q4 2020. More than a quarter of SMEs plan to invest more in their businesses in the year ahead than during a typical pre-pandemic year – with 35% intending to invest £10,000 to £10m this year, a rise on 32% from 2020. However, only one in five SMEs expect to be able to keep all furloughed employees after the end of the Coronavirus Job Retention Scheme, with over 50% of small firms currently employing staff on furlough. Group business director at Virgin Money, Gavin Opperman, commented: “While there are undoubtedly significant challenges ahead, many businesses remain optimistic and intend to invest for the future as the economy recovers.”

The Scotsman City AM

SMEs need help to drive productivity up

Researchers at NatWest have determined that boosting productivity among SMEs could add £140bn to the economy by 2030 – the equivalent of an extra 3.2m jobs. Figures show SME productivity in Britain lags the US by 17% and Germany by 12%. Andrew Harrison, NatWest head of business banking, said: “Support needs to be more closely tailored to their specific needs.”

The Times, Page: 40

PROPERTY NEWS – TUESDAY 30TH MARCH 2021

Stamp duty holiday drives mortgage lending to five-year high

New Bank of England data show that the stamp duty holiday extension spurred home buyers to borrow £6.2bn last month – a five-year high for mortgage lending. Some 87,700 mortgages were approved in February, down from more than 100,000 in November and December, but still one of the highest numbers since 2007. “We suspect that mortgage lending will remain high this year given the extension to the stamp duty holiday and the strength of the survey data,” said Andrew Wishart at Capital Economics. “As a result, mortgage approvals for house purchase are likely to reach their highest level since 2007 this year.”

The Daily Telegraph City AM

PENSIONS NEWS – TUESDAY 30TH MARCH 2021

Defined contributions increase in Q4 2020

New ONS data reveals defined contribution (DC) pension contributions have returned to pre-COVID levels, with employee contributions up 12% in the three months to September 2020 to £1.8bn. Employer contributions to DC schemes jumped 7% to £4bn in the third quarter of 2020, up from £3.7bn in the previous quarter. AJ Bell’s Tom Selby said: “It is hugely encouraging that, after a dip in both employee and employer pension contributions at the start of the pandemic, the amount savers are saving for retirement has quickly bounced back.”

Corporate Adviser Pensions Age European Pensions Money Age

CORPORATE NEWS – TUESDAY 30TH MARCH 2021

Shell director’s pay could be linked to climate action

Shell has suggested that its director’s pay could be linked to the group’s climate performance, following a similar announcement from BP last week when its shareholders were told to vote against a climate resolution that would demand the firm’s decarbonisation plans are aligned more closely with the 2015 Paris agreement. This comes ahead of a Shell shareholder vote on the issue in May.

City AM

ECONOMY NEWS – TUESDAY 30TH MARCH 2021

Optimism about household finances rises

The Scottish Widows Household Finance Index rose from 41.1 to 42 in the first three months of the year, encouraged by the success of the vaccination programme and the “road map” out of lockdown. The survey, conducted with IHS Markit, found people are feeling the most secure in their jobs since the start of the pandemic and have paid off debts at the fastest rate in more than a decade.

The Times

OTHER

Council work defended by auditor

Grant Thornton ’s audit work on Liverpool Council has been defended by the firm. After Liberal Democrat councillor Andrew Makinson said last week: “The taxpayers of Liverpool have been paying £191,000 to Grant Thornton to provide assurances that the city’s accounts are in order. While you’ve not been able to fully certify them… you have repeatedly provided value for money assurances and various concerns raised by opposition councillors have been rather dismissed by yourselves.” The company’s director Andrew Smith responded: “We are confident in the work we’ve done in those areas… There are very serious best value issues in there but there is a limit to what we can do around that in terms of the requirements of the value for money work.”

City AM

Contact Paul Southward

Paul Southward

NEWS – MONDAY 29TH MARCH 2021

NEWS – MONDAY 29TH MARCH 2021

NEWS ROUNDUP

TAX NEWS – MONDAY 28TH MARCH 2021

England stars facing tax demands from HMRC

Senior England players may be probed by HMRC about taxes paid on their image rights, with the FA and players’ lawyers reportedly meeting with the Revenue last month. Image rights payments are usually paid into a company set up for the player and these firms will pay corporation tax at a rate of 19%. The Mail reports that HMRC is keen to crack down on the payments to companies.

Daily Mail The Sun

SMEs NEWS – MONDAY 28TH MARCH 2021

Small businesses halt exports to EU

A study from the Federation of Small Businesses has found that more than a quarter of small exporters have stopped selling to EU customers three months on from the Brexit transition. The survey of nearly 1,500 small firms found that 23% had temporarily stopped selling to the EU and 4% had halted sales permanently. The FSB added that about 11% had set up, or were considering, a presence in an EU country to make the process easier. The survey also found that majority – 70% – of importers and exporters said that they had suffered shipment delays when moving goods around the EU in recent weeks. More than 30% have lost goods in transit and a slightly higher proportion have had goods held indefinitely at EU border crossings. Mike Cherry, chairman of the FSB, said: “Those that do business internationally are being hit with some incredibly demanding, unfamiliar paperwork. Three months on from the end of the transition period, what we hoped would prove to be teething problems are in danger of becoming permanent, systemic ones. While larger firms have the resources and bandwidth to overcome them regardless, smaller traders are struggling, and are considering whether exports are worth the effort anymore.”

The Times, Page: 39 The Guardian, Page: 28 Daily Mail, Page: 74 The I, Page: 4

Tories are no longer the party for small businesses

Taha Lokhandwala writes in the Telegraph on Treasury plans to make freelancers pay tax more frequently, doing away with annual self-assessments. Government documents suggest moving to quarterly payments but this, says the freelancer trade body IPSE, would leave businesses with less cash to build up savings and manage volatile income; less money to invest; less incentive to be self-employed. Lokhandwala concludes: “The trajectory is clear: this Government no longer sees the benefit in entrepreneurship; it is no longer the party of small business.”

The Daily Telegraph

PENSIONS NEWS – MONDAY 28TH MARCH 2021

Women left disadvantaged by pensions system

According to analysis from professional services firm Barnett Waddingham, the UK pensions system disadvantages women compared to men, with females having 25% to 45% less in their pension pots at retirement. The analysis found that the gender pension gap begins to diverge most after the age of 32, with men contributing up to £1,500 per annum more into their pension than women. This is despite contributing the same percentage of their salary. The research found that a woman taking two 12-month career breaks in her early 30s, with no increase to pension saving or salary during this time, can have 10% less in her pension pot at retirement compared to a woman taking no breaks. Barnett Waddingham said that employers can consider five things to close the gender pensions gap; taking advantage of inertia – setting higher default contribution levels for when employees enter the pension scheme; addressing the shortfall after career breaks; introducing more targeted financial education; addressing the gender pay gap; and encouraging staff to pay in more when affordable to do so.

Yahoo! Finance

CORPORATE NEWS – MONDAY 28TH MARCH 2021

Gambling sector highlights its value ahead of shake-up

According to a study by EY, the gambling sector has been hit by the permanent closure of 374 betting shops, half a dozen casinos and the loss of about 5,000 jobs. The industry also supports 119,000 jobs and gives £4.5bn in taxes to the exchequer. The report, commissioned by the Betting and Gaming Council (BGC), comes as a call for evidence on gambling law reform closes on Wednesday. The BGC’s CEO Michael Dugher supports the review and the need for higher safety standards but warned not to put future jobs and tax revenue at risk with rule changes.

The Times, Page: 39 City AM

Government rejects £170m bailout for Gupta

Ministers are considering how jobs at Sanjeev Gupta’s GFG Alliance can be protected after the Government rejected a plea from the metals businesses for a £170m loan. Financing for the company has dried up since its main source of funding, Greensill Capital, went bust. The FT reports that ministers were anxious about GFG’s opaque structure and wanted to ensure any funding didn’t leave the UK. “Our priority is the UK sites and jobs, not this corporate entity,” said one government figure.

Financial Times The Times

Arcadia sells off furniture to raise more cash for creditors

Clearance company Hilco has been auctioning off furniture and fittings from the Arcadia estate in an effort to raise more cash for creditors. Sir Philip Green’s failed retail empire collapsed in November owing creditors £800m. When administrators at Deloitte were hired it also had a £510m pension deficit.

The Daily Telegraph, Business, Page: 3

ECONOMY NEWS – MONDAY 28TH MARCH 2021

Scotland’s recovery forecast to outpace UK’s

A best-case analysis from KPMG shows Scotland’s economy could grow by up to 5.5% this year providing there is a successful vaccine rollout and subsequent consumer boost. This compares with an expected 4.6% GDP growth for the whole UK. Next year, Scotland could see 5.8% growth against 5.6% UK-wide. Catherine Burnet, KPMG’s regional chairwoman in Scotland, said: “Our latest economic forecasting undoubtedly offers some optimism, but with a big slice of caution.”

The Times

UK economic data confound forecasters and beat expectations

The FT reports that policymakers and analysts are revising up their Q1 GDP forecasts as economic data continues to surprise them. Analysts now believe contraction for the quarter will be 1- 2.5% less deep than feared.

Financial Times, Page: 3

OTHER NEWS – MONDAY 28TH MARCH 2021

Auditor faces scrutiny over Liverpool council rating

Grant Thornton is facing scrutiny for signing off Liverpool City Council’s accounts with “value for money” assurances. The auditor has withdrawn its latest report into the local authority after the results of a Government inspection last week highlighted a number of failings. Grant Thornton was accused by councillors of ignoring concerns raised by opposition members and of failing to raise the alarm about issues uncovered. Grant Thornton said: “Value for money assessments were undertaken within the full scope of the National Audit Office’s code of practice at those times and based on the information available at those times.”

The Times, Page: 33

EY drops appeal in Dubai whistleblower case

EY has dropped its appeal against a case which saw former partner Amjad Rihan awarded $10.8m after he raised the alarm about a Dubai client suspected of laundering money and smuggling gold.

Financial Times, Page: 13

Contact Paul Southward

Paul Southward

NEWS – WEEKEND TO 28TH MARCH 2021

NEWS – WEEKEND TO 28TH MARCH 2021

NEWS ROUNDUP

TAX NEWS – WEEKEND TO 28TH MARCH 2021

SATURDAY

HMRC cracks down on second-home owners

People who register their properties as holiday lets but don’t rent them out are facing a crackdown after the Treasury said it would seek to verify the number of days the property was let for. HMRC will rescind eligibility to pay business rates instead of council tax and force homeowners to pay their local authority any money owed. They may also have to repay any additional tax relief they might have claimed. “In the crudest sense the suspicion is that a lot of these owners who say they are trying to rent a property for 140 days and so benefit from this lucrative status aren’t actually interested in doing so at all,” said Adam Matthews, a manager at RSM. “The system is clearly open to abuse — it’s an easy way to save on tax.”

The Times, Page: 61 The Daily Telegraph, Money, Page: 2

Missed opportunities of ‘tax day’

Claer Barrett outlines in the FT what opportunities she thinks the Treasury missed with its Tax Day announcements, namely reducing and simplifying the UK tax code.

Financial Times, Money, Page: 6

HMRC seeks to support taxpayers with overseas assets

Although HMRC only collects 5% of international tax debt, it says incorrect reporting is not always deliberate and so is now focussing on raising taxpayers’ awareness of their obligations.

Financial Times, Money, Page: 2

SUNDAY

HMRC unit checks rebate claims are legitimate

Some people applying for a simple tax rebate are being asked to prove their identity by an HMRC repayment credibility team, which has been granted extra powers to find fraudsters. They are being asked to fill in a three-page questionnaire and submit bank or building society statements, P60s, P45s and expenses receipts as well as one proof of address and two of identity. They have 30 days to comply, after which HMRC said they could be removed “from the self-assessment regime”. George Bull at RSM said the letters were often in response to very small claims and that the threats were “disproportionate”. Elaine Clark from Cheap Accounting adds: “The text of the letter is very heavy-handed. Does HMRC have a security problem? How easy is it for someone to hack a self-assessment account? I expect it may be easier than we’d like to think, especially in light of the significant Covid fraud.”

The Sunday Times, Business, Page: 13

Taxpayers have just days to act before penalties imposed

Individuals now have less than a week to sort out their Self-Assessment tax affairs or risk meeting potentially hefty penalties, HMRC has warned. The Revenue previously announced it would delay imposing penalties for the late payment of Self-Assessment by one month – to April 1st. But Graham Boar at UHY Hacker Young explains that interest payments of 2.6% on a delayed payment will have been building up since the January deadline and people who are not in a position to pay their bills now should take action urgently. He adds: “HMRC is actively encouraging taxpayers to make use of Time to Pay arrangements, this could be a lifeline for individuals who know they will struggle to pay their tax bill on time. If they choose to ignore it, they’ll only see the money owed increase even further.”

Sunday Express

Managing IHT as £293bn is ‘earmarked’ for grandchildren

New research from The Openwork Partnership shows more people could be hit by IHT over the coming years as parents and grandparents have “earmarked” more than £293bn for early inheritance payouts to children and grandchildren. Commenting on the results, Mike Morrow, the Chief Commercial Officer at The Openwork Partnership, said: “The size of the gifts underlines the need for trusted advice on how best to use the money whether it is to pay for house deposits or pay off debt or to invest for the future. Parents and grandparents as well as children and grandchildren would benefit from an ongoing relationship with a financial adviser.” The Express goes on to talk with experts about how IHT liabilities can be reduced, including using gifts and well-constructed wills.

Sunday Express

EMPLOYMENT NEWS – WEEKEND TO 28TH MARCH 2021

SATURDAY

Working from home could boost output

Bank of England policymaker Michael Saunders has said remote working could boost productivity by saving companies money on office space, increasing staff satisfaction and providing access to a wider pool of workers. “While a shift to widespread compulsory full working from home probably is not optimal, working from home offers a range of possible advantages for some firms,” he said. Separately, Rishi Sunak, the Chancellor, is urging businesses to open up their offices and end remote working because young people need to convening with colleagues and seek out mentors as they embark on their career development.

The Times Sky News

REGULATION NEWS – WEEKEND TO 28TH MARCH 2021

SATURDAY

UK and EU reach financial regulation deal in breakthrough on co-operation

The United Kingdom and the European Union have reached a deal to create a forum for cooperation on financial services regulation. The memorandum of understanding (MoU) sets the terms of engagement between the two parties but does not yet grant the City of London access to the EU’s Single Market. “Formal steps need to be undertaken on both sides before the MoU can be signed but it is expected that this can be done expeditiously,” the UK said in a statement, adding that the MoU created a “framework for voluntary regulatory co-operation in financial services” rather than any binding system.

Financial Times The Daily Telegraph City AM

CORPORATE NEWS – WEEKEND TO 28TH MARCH 2021

SATURDAY

Jessops files for administration

Jessops has filed a notice to appoint administrators. The camera retailer, bought by Peter Jones’s PJ Investment Group in 2013, has hired insolvency specialists FRP and is considering a Company’s Voluntary Arrangement in a bid to survive after it was severely impacted by lockdown restrictions. Geoff Rowley, partner at FRP, said: “Jessops is a long-established British brand, but like many others, it has faced growing online competition, as well as the challenges faced by all high street retailers in operating through the restrictions imposed during the pandemic. We are working closely with PJ Investment Group and the wider Jessops management team to consider all options to secure a future for the retailer.”

BBC News Daily Mail The Mirror

Gupta asks UK Government for £170m bailout

Sanjeev Gupta, the owner of Liberty Steel has asked the government for £170m in financial support. The collapse of Greensill Capital, the company’s key financial backer, has put Gupta’s GFG Alliance and its 5,000 UK workers in jeopardy.

BBC News The Daily Telegraph Financial Times

BoE warns banks against sudden halt to Covid-related lending

Lenders have been urged by the Bank of England to keep credit flowing to businesses once the state-backed COVID-19 loan schemes come to an end, warning that withdrawing funding would prove self-defeating.

Financial Times

SUNDAY

Landlords fear growing use of “cram down” mechanism

The Sunday Times’ Sam Chambers reports on Virgin Active’s use of a new restructuring tool enabled by changes to the UK’s corporate insolvency regime, designed to ease restructurings. Under the rules, companies can ask a judge to force through restructurings if too few creditors vote to approve it – the so-called “cram down” mechanism. “Landlords are up in arms because this issue will be on the radar of every company sitting on a load of rent arrears,” said Zelf Hussain, restructuring partner at PwC, which is advising British Land and Land Securities in the Virgin Active case. Virgin, which is being advised by Deloitte, is seeking to force landlords to write off or defer rent arrears – and take a haircut on future rent. Will Wright, head of restructuring at KPMG, said the increasing number of legal challenges brought by landlords against CVAs had created uncertainty around the process. Subsequently, he expects cram down restructurings to become more common.

The Sunday Times, Business, Page: 3

Scottish government calls in experts to examine Gupta deal

Ministers in Nicola Sturgeon’s administration have drafted in Deloitte to comb through state guarantees handed to GFG Alliance, the industrials conglomerate owned by Sanjeev Gupta. GFG’s biggest lender, Greensill Capital, recently collapsed leaving Gupta’s businesses in a precarious position. The Sunday Telegraph reports that the Scottish government guaranteed payments worth an estimated £360m to help Mr Gupta buy the Lochaber aluminium smelter and associated hydropower plant at Fort William five years ago. A source said Deloitte had been retained since 2017 to monitor the Lochaber guarantees.

The Sunday Telegraph, Business, Page: 1

Pandemic persuades bosses they should fly less

A year of lockdowns and Zoom meetings has convinced UK corporates they can help limit pollution by restricting business travel after restrictions ease. With ever more companies committing to reach net zero emissions many are revising their corporate travel strategies. PwC’s UK chairman Kevin Ellis tells the Sunday Times that although corporate travel will spike once restrictions are lifted, and this will be “an important signal for business about recovery and the return to normality”, in the long term “there will be more of a pragmatic level of business travel.”

The Sunday Times, Business, Page: 4, 5

Eurostar must restructure debts to stay on track

With financial collapse looming this summer, Eurostar is in emergency talks with lenders to restructure £400m in loans. The channel tunnel operator is in advanced discussions with NatWest, Santander and Credit Agricole to secure funding. Freshfields and financial specialists from KPMG are understood to be advising Eurostar. Linklaters is providing legal advice to the group of banks.

The Sunday Telegraph, Business, Page: 1

NCP plans to force through rent cuts

Car parks operator NCP is utilising a change in insolvency law to push through a controversial restructuring, the Sunday Times reports. Advised by Deloitte, the Japanese-owned company has told landlords that unless it can write off rent and potentially walk away from some sites it will go bust. The plans will save NCP up to £27m over the next two years.

The Sunday Times, Business, Page: 1

INDUSTRY NEWS – WEEKEND TO 28TH MARCH 2021

SATURDAY

Trust in UK corporate sector is low, admits chief of audit watchdog

Interim chair of the Financial Reporting Council, Keith Skeoch, tells the FT the watchdog is preparing for a raft of corporate failures this summer. British boardrooms should also get ready for governance changes.

Financial Times

One small step for man, one giant leap for ESG accounting standards

The FT reports on the World Economic Forum’s plan to mobilise CEOs’ support for the Sustainability Standards Board, which the international accounting standards setters at the IFRS Foundation are developing.

Financial Times

PENSIONS NEWS – WEEKEND TO 28TH MARCH 2021

SATURDAY

Would a flexible pension system really benefit the poor?

The Telegraph’s Sam Brodbeck considers the winners and losers from the state pension system, namely the wealthy who generally live longer. He notes a call from the Trades Union Congress for the pension age to be frozen and says such a flexible system may be fairer – where those who are unable to work or who don’t expect to live long enough to get a decent return can opt to access their pension early. However, it would carry terrible risk for those who misjudge their longevity and would introduce yet more complexity.

The Daily Telegraph, Money, Page: 2

SUNDAY

1,000 people a day trigger pension tax charge

According to figures from Just Group, more than 1,000 people a day have been hit by punitive tax rules that limit what they can pay into their pension by 90%, after having to dip into their pension during the pandemic. Just Group found that more than 600,000 people accessed their pension pot for the first time in 2020, in order to make ends meet. Introduced in 2015, the “pension freedom” rules allow savers to access their cash from 55. However, withdrawing income from some types of pension triggers the “money purchase annual allowance”, which reduces the amount a saver can pay in and earn tax relief by 90%, from £40,000 to £4,000. In 2020, 206,000 workers triggered the new lower limit, bringing the total number of savers affected by the cap to 1.6m. Kate Smith of Aegon said the rules were outdated and called on the Government to increase the money purchase annual allowance from £4,000 to £10,000. She said: “Job insecurity and a volatile stock market have thrown the retirement plans of many over-50s into disarray. The ability to access their pension flexibly has thrown them a lifeline, but it comes with a sting in the tail.”

The Sunday Telegraph, Business, Page: 9

Increased living costs renders triple lock “worthless”

The rising cost of care for pensioners alongside tax hikes has left the Government’s “triple lock” for the state pension “worthless”, Jessica Beard reports in the Sunday Telegraph. One pensioner told the paper an increase in care costs and council tax had wiped out meagre gains in the state pension and income from savings, which had dwindled as interest rates are continually slashed. Ian Browne of Quilter said: “Retirement has never been more challenging financially. This is clear if you simply focus on the rocketing social care costs.” The Telegraph points out that Britain has the worst mandatory pension provision of all 36 countries in the OECD, with retirees’ pension income 28% of their pre-retirement earnings, about half the other countries’ average.

The Sunday Telegraph

ECONOMY NEWS – WEEKEND TO 28TH MARCH 2021

SATURDAY

Retail rebounds from January slump

Data from the Office for National Statistics show a bounce back in sales last month following a sharp fall at the beginning of the year. Sales rose by 2.1% in February, up from an 8.2% fall in January, when the country went into its third lockdown. Non-essential retail in England is expected to reopen on April 12 and retailers “will be hoping that the wave of optimism sweeping consumers as a result of the successful vaccine rollout will translate into increased sales”, said Lisa Hooker, consumer markets leader at the consultancy PwC. Elsewhere, Howard Archer, chief economic adviser at the EY Item Club, said: “The modest rebound in retail sales adds to the evidence that the economy came off its January lows in February.”

The Times Financial Times, Page: 3 The Daily Telegraph Daily Express, Page: 71

INTERNATIONAL NEWS – WEEKEND TO 28TH MARCH 2021

SATURDAY

U.S. trade chief prepares tariffs against countries over digital taxes

The Office of the United States Trade Representative (USTR) has said it will continue to evaluate options to impose tariffs on countries that have introduced taxes targeting in-country revenues of digital services platforms. Such tariff investigations were introduced by the Trump administration and on Friday U.S. Trade Representative Katherine Tai said she was maintaining the threat of tariffs on goods from Austria, Britain, India, Italy, Spain and Turkey in retaliation for their digital services taxes. “Today’s move by USTR is an important affirmation in pushing back on these discriminatory trade barriers as the U.S. continues to work to find a viable solution at the OECD,” the trade group said in a statement.

Daily Mail

SMEs NEWS – WEEKEND TO 28TH MARCH 2021

SUNDAY

Accelerating tax receipts poses risk to cash flow

The Sunday Times considers the impact of Rishi Sunak’s plan to require individuals and small businesses to pay tax as they earn. The changes mean that millions of high earners, investors and self-employed people may have to pay two years’ tax in one year after 2024, the paper explains. George Bull at RSM warns that when “dramatically accelerating the collection of taxes, the Government must take care not to damage small businesses’ cash flow. There’s no sense in killing the goose that lays the golden egg.” Nimesh Shah, the chief executive of Blick Rothenberg, agreed. “The cash flow impact could cause severe pressure and should be phased in over four years. HMRC really needs to start communicating now, so people can plan.”

The Sunday Times, Business, Page: 13

PERSONAL FINANCE NEWS – WEEKEND TO 28TH MARCH 2021

SUNDAY

Parents forced to use their kids’ Isas amid savings boom

A surge in middle-class family savings during the pandemic has led parents to use their children to shelter more wealth from tax. Hargreaves Lansdown said a fifth more of its customers have paid into Junior Isas in 2020-21 than the year before, investing 45% more on average for their children. The firm’s Sarah Coles said: “Around one in six people have seen their finances improve during the pandemic, as the result of a combination of working from home and not being able to go out to do anything fun. At the same time the Government almost doubled the Jisa allowance, opening up a brilliant opportunity to squirrel away money.” Ms Coles added: “This particularly appeals to families where the adults have maxed out their £20,000 Isa allowance and are looking for further tax-efficient opportunities.”

The Sunday Telegraph

OTHER NEWS – WEEKEND TO 28TH MARCH 2021

SUNDAY

Amazon clashes with Elizabeth Warren over taxes and unions

Amazon has become embroiled in a row with U.S. senator Elizabeth Warren over issues including its tax and employment practices. Last week, the Massachusetts senator posted a video accusing Amazon of “exploiting loopholes and tax havens to pay close to nothing in taxes”. In response, Amazon said it was simply following the laws made by Congress, insisting it had paid billions of dollars in corporate taxes in the last few years alone. Warren hit back saying: “I didn’t write the loopholes you exploit, @amazon – your armies of lawyers and lobbyists did. But you bet I’ll fight to make you pay your fair share. And fight your union-busting. And fight to break up Big Tech so you’re not powerful enough to heckle senators with snotty tweets.”

Financial Times Business Insider

Contact Paul Southward

Paul Southward