A report in the Evening Standard yesterday (September 12) said that Lib Dem president, Tim Farron, will be outlining the plans at the party conference and will suggest that individuals with wealth and property worth more than £2m could pay a higher rate of tax than those caught by the simple mansion tax.
Explaining his thought process to the Evening Standard, Mr Farron said that he would prefer to look at people with properties and wealth at a much higher level than £2m and is suggesting that there will be a sliding scale within the mansion tax plan. For example, someone with a property worth £4m would pay a higher rate than someone with a property worth around £1m.
Mr Farron’s proposals come after an estate agent warned that the original mansion tax plans would fall short of the party’s ambition to raise £1.7m through the tax.
The estate agent suggested that the levy would need to be extended to all homes worth more than £1.25m, which would more than double the number of homes affected.
However, even if the threshold were to be kept at £2m, the number of properties affected by the tax would increase from 55,000 to 775,000 over the next 25 years, assuming current rates of price rises.
For more information, speak to Glazers, Chartered Accountants in London or visit www.glazers.co.uk
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( 2.9 / 536 )The UK’s unemployment rate fell to 7.7 per cent between May and July, from 7.8 per cent in the previous three months, meaning that the number of people unemployed fell 24,000 to 2.487 million.
The official figures released this week also showed that the number of people claiming Jobseeker's Allowance fell to 1.402m, its lowest level since February 2009.
However, there were concerns among the unions that the number of people working part-time because they cannot find a full-time job rose to 1.45m, the highest since records began in 1992 and double the number from five years ago.
Almost a third of men working part-time said they were doing so because they could not find full-time employment, while the corresponding figure for women was 13.5 per cent.
The figures are particularly significant because Governor of the Bank of England, Mark Carney, pledged recently to freeze interest rates until unemployment falls to 7 per cent, which he said could be as far away as 2016. However, that could now be seen as a conservative estimate and economists generally expect the percentage to be achieved sooner.
The Government is claiming the figures are a sign that the economy is recovering, with the Minister for Employment, Mark Hoban, saying that the number of people in work rocketing by 80,000 in only three months has been driven entirely by a growth in full-time jobs.
Mr Hoban added that the private sector has created jobs for 1.4 million more people, with more people employed in the private sector than ever before, suggesting that the UK economy is “turning the corner.”
For more information, please contact Glazers, Chartered Accountants in London or visit www.glazers.co.uk
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( 3 / 507 )It was announced earlier this week that the Government is to reduce burdensome accounting red tape for micro-businesses, making them exempt from certain financial reporting requirements.
The 1.5 million firms in the UK that qualify as micro-businesses are currently subject to the same accounting rules as other small firms.
However, following a consultation on an EU Directive earlier this year, the first in which micro-entities have been recognised in a deregulatory Directive, the Government realised that keeping them to the same stringent rules as larger small firms was an unfair burden for organisations of their size.
Consequently micro-businesses will be allowed to prepare and publish much reduced financial statements, including an abridged balance sheet and profit and loss account. They will also continue to be exempt from the requirement to file the profit and loss account with Companies House.
Commenting on the decision, the Business Minister, Jo Swinson, said that thriving micro-businesses are a vital ingredient for a stronger economy; however, because of their size they do not always have dedicated finance teams behind them.
She added that the Government realised therefore that it needs to ensure that they can focus on growing their business rather than completing unnecessarily detailed paperwork.
By cutting bureaucracy, she added, and letting micro-businesses get on with running their enterprises and creating jobs, they can continue to make a valuable contribution to economic growth.
The changes will come into force from the end of this month and will apply to financial years ending on or after 30 September 2013 and related accounts on or after the date on which the changes are implemented.
For more information, please contact Glazers, Chartered Accountants in London or visit www.glazers.co.uk
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( 3 / 554 )According to the Chief Executive of the Financial Conduct Authority (FCA), compensation for interest rate swap mis-selling should be completed by April next year.
Martin Wheatley said that “nobody wants this to drag on for years and years”, so has given the banks until April 2014 to complete the task, although he noted that it is “quite a challenge” to get to that.
At the moment, only £500,000 has been paid out in 10 cases, even though the banks have taken on an extra 2,800 staff to deal with more than 30,000 of them and despite it being more than a year since the regulator set up the redress scheme for victims of the scandal.
To date, the banks have set aside £2.5bn to cover the claims for compensation that have been lodged, although provisions made by different banks vary wildly. State-backed RBS has the most claims at 10,528, while Barclays faces 3,436. RBS has only set aside half as much but Mr Wheatley said that the state-owned bank might explain the reasoning behind the difference by the unequal complexity of the products that RBS and Barclays had sold.
However, the FCA’s figures show that RBS is also behind the other banks in the redress process, with some 4,602 cases still at the “sophistication assessment” stage, compared to none at Barclays and fewer than 900 at Lloyds.
Critics are concerned that the banks could try to delay paying compensation but the regulator has pointed out that, since all compensation payments are subject to eight per cent interest, which will accrue until paid out, that would not be in their interests. In addition, Mr Wheatley said, all the CEOs of the banks have agreed by their actions that they will not force businesses into bankruptcy.
For more information, please contact Glazers, Chartered Accountants in London or visit www.glazers.co.uk
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( 3 / 548 )G20 leaders said at the summit last week in St Petersburg that they expect to begin automatically sharing tax information by the end of 2015, as part of plans to tackle global tax evasion.
In a joint statement published on Friday (September 6), the leaders said they would take steps to close loopholes that allow legal tax avoidance by big businesses and also pledged to help developing nations tackle tax evasion by helping them track funds in tax havens.
More than 50 countries have now signed up to an international convention to facilitate the exchange of information on tax issues. However, many developing countries have not signed up, and the G20 countries have agreed to share expertise on tracking funds to encourage them on board.
Regarding the perfectly legal activities of big businesses that avoid large tax bills by moving profits from country to country, the statement said that the G20 would be putting forward recommendations to set up a system so that profits are taxed "where economic activities deriving the profits are performed and where value is created"
The leaders said that tax avoidance, harmful practices and aggressive tax planning have to be tackled, and added that the growth of the digital economy also poses challenges for international taxation.
The summit called on member countries to examine their own domestic laws that contribute to profit shifting and also called on them to join the Office for Economic Co-operation and Development’s (OECD) Multilateral Convention on Mutual Administrative Assistance in Tax Matters.
The proposed tax information exchange plan agreed at the summit will be drafted by the OECD and borrows heavily from the Foreign Account Tax Compliance Act drawn up by the US, which came into force this year and requires financial firms globally to disclose details of the assets of all American citizens held overseas.
For more information, please contact Glazers, Chartered Accountants in London or visit www.glazers.co.uk
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