HMRC broadens wealth probe net
The Times reports on the growth in HMRC’s Affluent Unit which investigates those with an annual income of more than £150,000, or a net worth of £1m. The unit has taken on 68 new inspectors this year, bringing the total to 395. Meanwhile, HMRC’s High Net Worth Unit now investigates individuals with wealth greater than £10m after having reduced its entry criteria by £10m. The Times suggests the Revenue is becoming increasingly sophisticated in its investigations following the introduction of its Connect computer system, which it uses to cross-reference returns against data gathered from a multitude of sources. However, obstacles remain, with the FT reporting that the Law Society will oppose attempts by HMRC to force lawyers to divulge the names of clients with offshore trusts and companies.
Reported in :The Times, Financial Times
Warnings issued over digital tax reporting
The Mail on Sunday reports on Andrew Tyrie’s call last week for a delay in the implementation of the government’s Making Tax Digital (MTD) scheme. The chairman of the Treasury Select Committee conceded that “the digitisation of tax records and reporting can be an opportunity greatly to improve the administration of the tax system for the long term” but MTD could be a disaster if implemented without sufficient care. According to research carried out by YouGov for 1Tap Receipts, an expenses management app for sole traders, 94% of self-employed workers had not heard of the initiative and 45% spend five hours or more on their tax return.
Reported in : The Mail on Sunday
May's new industrial vision welcomed by business
Theresa May's new industrial strategy has been broadly welcomed by business, with James Sproule, director of policy at the Institute of Directors, praising the "joined-up thinking" and David Petrie, head of corporate finance for the ICAEW saying long-term funding for capital-intensive companies in areas such as life sciences and engineering would help them succeed. Carolyn Fairbairn, director-general of the CBI added that the strategy creates “an opportunity for all sectors to get involved." Mike Cherry, national chairman of the FSB said he was impressed that the green paper “is formed around driving local economic growth and productivity” rather than using a top-down approach. However, the ICAEW’s business director Stephen Ibbotson highlighted the lack of targets for productivity improvement describing this as a missed opportunity.
Reported in: The Daily Telegraph, Independent I, The Times, The Guardian, The Times
Business Secretary backing City during Brexit
The Business Secretary has championed the financial sector as a “huge national asset”. Speaking to the BBC's Today programme, Greg Clark said the government was “totally committed” to maintaining the City's status, adding: “It's a huge national asset which is not just vital in terms of what it contributes to the economy in terms of jobs, taxes, but it also gives rise to a lot of employment, a lot of success, in adjacent areas”. Meanwhile, Gary Elden, chief executive of recruiter SThree, has cast doubt on Frankfurt's claims it will steal City jobs after Brexit and cautioned against believing “scaremongering” about the industry's future.
Reported in: City AM, Evening Standard, Financial Times
Banks urged to hold off on Brexit moves
The heads of UK banks are lobbying their foreign counterparts to stall plans to move operations to other major European cities. The campaign is understood to be led by John McFarlane, chairman of Barclays and Shriti Vadera, Santander UK chairman, through lobby group the European Financial Services Chairmen’s Advisory Committee. A source close to the talks said: “We are trying to get a permanent agreement for banks with London operations to access the EU. If we can’t do that, what we’ve asked for is a three-year standstill agreement. We don’t want to trigger contingency plans in advance because of a lack of certainty so we are saying 'hold on’.”
Reported in: The Sunday Telegraph, The Daily Telegraph, Financial Times
Minister to become 'scale-up champion'
Small Business Minister Margot James is set to become the Government's 'Scale-up Champion' as part of its new industrial strategy. Ms James will be charged with helping thousands of start-ups transform into substantial companies. Sky News says the role is being created to address the fact that the UK ranks 13th in international league tables for successful scale-ups, even though it places third for start-ups. The Government’s new strategy is said to acknowledge obstacles firms face when trying to expand, including difficulties in accessing finance.
Reported on: Sky News
Brexit has impacted investment
Philip Hammond has admitted that Brexit uncertainty may cause firms to delay investment. Speaking at Davos, the chancellor said some firms were “quite understandably … waiting for the fog of Brexit to clear”. Some companies are delaying investment decisions, and waiting “to have a better understanding what the future looks like”, he said. Mr Hammond added that the UK is now seen as a buying opportunity due to the depreciation of sterling. He pointed to investments by Google, Apple and Softbank to elaborate on his point.
Reported on: BBC News
Fears raised over customs IT capacity
Ministers have been warned that the possible reintroduction of customs declaration requirements post-Brexit could cause major problems for HMRC’s IT system. The 25-year-old Customs Handling of Import and Export Freight (Chief) system is being replaced with the Customs Declaration Service (CDS), designed to handle 100m filings a year. However, business leaders predict leaving the customs union could mean as many as 390m declarations a year will be filed by 2019. An HMRC spokesman said: “The new system will support any changes to legislation, redesigned business processes and increased volumes of transactions.”
Reported in: The Times
New P2P lenders may expose investors to risks
The Times reports that concerns are growing in the P2P lending industry that the market is being flooded with start-ups, that could expose investors to undue risks. Figures from the FCA show that scores of operators are in the process of applying for regulatory authorisation. As of December 28, 56 firms had either “interim permission” or full authorisation from the regulator to operate a P2P lending platform. There are 68 applications for new or varied authorisation being considered.
Reported in: The Times
Nissan to review Sunderland plant’s competitiveness
Carlos Ghosn, the head of Nissan, has said the Japanese carmaker will conduct a review of its Sunderland plant’s competitiveness once the UK’s future relationship with the EU is settled. Ghosn was reported as saying that Nissan trusted Theresa May’s assurances, but that the company would need to review the situation.
Reported in: The Guardian, The Independent, ITV News
Crest Nicholson hits target despite Brexit jitters
Crest Nicholson has hit its £1bn sales target despite buyers cancelling deals in the period leading up to and just after the Brexit referendum in June, which cost the business £40m. The company said it was on track to significantly boost the number of homes it builds by the end of the decade, with a target of 4,000 units each year. In the 12 months to October 31st 2016, the company built 2,870 homes, 5% more than in the previous year. Pre-tax profits for the year were 27% higher at £195m. Chief executive Stephen Stone said he did not expect further uncertainty in the market as the UK moves through the process of leaving the EU.
Reported in:The Daily Telegraph, Financial Times
Report warns of tech’s Brexit fears
Research commissioned by techUK shows that foreign workers have filled 45% of recent vacancies in digitally-intensive industries. The report, suggests the Guardian, shows the impact this sector could see if access to European talent was reduced by the UK’s divorce from the EU. Jacqueline de Rojas, president of techUK and managing director of Sage, said: “There is no sector more dynamic, more innovative, more resilient than tech, but that doesn't make it immune to Brexit.” techUK deputy chief executive Antony Walker also warned that firms are “taking the government at its word that it will maintain access to European markets and skilled workers,” pointing to Facebook and Google’s decisions to maintain European headquarters in London, warning that firms are still concerned over the impact of Brexit.
Reported in: The Guardian
Steep rise in firms fined over auto-enrolment
Aviva's quarterly auto-enrolment tracker found that in the final three months of last year 14% of businesses missed their staging date for setting up a workplace pension, while 38% left their application scheme to the last minute. Meanwhile, figures from the Pensions Regulator show a dramatic increase in the number of employers that have been fined for failing to comply. More than 3,700 businesses were penalised between July and September, compared with 861 in the previous quarter. Companies can be fined an initial £400 and then between £50 and £10,000 for each additional day of non-compliance, depending on their size.
Reported in: The Times
Seedrs co-hosts start-up competition
Crowdfunding site Seedrs is to co-host the UK division of the China Innovation and Entrepreneurship International Competition alongside InteBridge Venture Capital. Ten winners of the start-up contest will travel to Shenzhen to compete for £100,000 against international rivals. As well as the London competition, events will also take place in the US, Australia, Canada, Israel, Japan, India and Germany.
Reported in: The Mail on Sunday
Wanted: angel investors to help ‘tough tech’ grow wings
John Thornhill considers how the new digital economy has disrupted R&D with companies less inclined to think long term and invest in developing the next level of innovative technology.
Reported in: Financial Times
May: Benefits of globalisation must be shared
In a speech to the World Economic Forum in Davos, Theresa May called for fairer treatment of workers and for multinationals to start paying their taxes. Those who felt left behind by globalisation also needed to see prosperity spread more widely while businesses needed to address the issue of executive pay, she said. Meanwhile, CBI head Carolyn Fairbairn has praised the Chancellor Philip Hammond for conveying confidence at Davos when he told delegates the UK would “do whatever is necessary to ensure the continued competitiveness of our economy”. Mr Hammond said the UK must remain “one of the most open economies in the world” and urged EU leaders not to allow “political retribution to triumph over economic logic”.
Reported in: The Daily Telegraph, Financial Times, The Sun, The Guardian, The Times, Daily Mail, The Independent
Corporate ‘resilience’ boosts tax receipts
The government remains on track to meet a deficit reduction target this year, after corporate "resilience" helped to boost tax receipts. The ONS reported a broad increase in tax receipts last month compared with a year earlier, as corporation tax rose 12.4% to £4bn and NI receipts increased 10.1% to £10.6bn. The OBR said that growth in corporation tax receipts remained stronger than its full-year forecast, which "could reflect the resilience of sales growth since the [EU] referendum." In addition, the UK deficit fell to £6.9bn in December.
Reported in: The Daily Telegraph, Financial Times, The Times, Daily Express, The Independent, Daily Mirror, Evening Standard