Tuesday, 24 March 2020 13:23

UK practical business advice: COVID-19

Coronavirus Job Retention Scheme

Under the new Coronavirus Job Retention scheme, government grants will cover 80% of the salary of PAYE employees who would otherwise have been laid off during this crisis. The scheme, open to any employer in the country, will cover the cost of wages backdated to 1 March 2020 and will be open before the end of April. It will continue for at least three months, and can include workers who were in employment on 28 February.

To claim under the scheme employers will need to:

  • designate affected employees as ‘furloughed workers’, and notify employees of this change. Changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation; and
  • submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal. HMRC will set out further details on the information required.
  • HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month.

While HMRC is working urgently to set up a system for reimbursement, we understand existing systems are not set up to facilitate payments to employers. Business that need short-term cash flow support, may benefit from the VAT deferral announced below and may also be eligible to apply for a Coronavirus Business Interruption Loan.

VAT payments

The next quarter of VAT payments will be deferred, meaning businesses will not need to make VAT payments until the end of June 2020. Businesses will then have until the end of the 2020-21 tax year to settle any liabilities that have accumulated during the deferral period.

The deferral applies automatically and businesses do not need to apply for it. VAT refunds and reclaims will be paid by the government as normal.

 

Source: https://www.icaew.com/insights/coronavirus/uk-practical-business-advice-covid-19

 

Banco Santander is to acquire a majority 50.1% stake in Spanish trade finance software house Mercury TFS through a €30 million investment.

Santander has used Mercury TFS’s services in Spain, Mexico, Chile and Germany for years, helping customers to manage their entire trade finance activity online or via mobile phone. The bank's businesses in the UK and Portugal will begin using it at year-end through Global Trade Services (GTS), Santander's global trade platform.

The head of Santander's global payments services, Javier San Félix, comments: “The investment accelerates our plans to build a service platform for SMEs and international companies to better serve our customers worldwide. We are also helping to globalise Mercury TFS, a software company with huge potential and a team with enormous talent, by reinforcing their technical and commercial teams and complementing their already broad product range.”
 
 

You’d expect Larry Summers, former US Treasury Secretary under President Bill Clinton and adviser to President Barack Obama, to twist the knife, and he did so stylishly. By destroying “about $500bn in equity market value in course of an 11-minute speech”, President Donald Trump had set “what I believe is a new world record for presidential market value destruction”.

Fair point. Trump’s ban on flights from 26 European countries lacked rhyme or reason. It runs counter to the World Health Organization’s advice and virtually guarantees the economic hit to the US will be intensified. More to the point, the president said virtually nothing about how the US will construct its healthcare response to the pandemic.

Trump also managed to lower already-low hopes that the world’s big economies would summon a spirit of collectivism. The US president seems mostly concerned with finding someone to blame while ensuring trade tensions with the EU are set to maximum, the natural reading for why flights from the UK to the US will be permitted (for now).

 

 

Source: https://www.theguardian.com/business/nils-pratley-on-finance/2020/mar/12/trump-bid-to-calm-crisis-simply-caused-more-financial-chaos

 

Wednesday, 19 February 2020 15:46

UK cash system is 'at risk of collapse'

The UK’s cash system will collapse without urgent legislation to protect it, according to a new study.

Panel members behind the Access to Cash Review, which published its final report a year ago, said action is needed to protect cash for as long as people need it.

They say that in the 12 months since their last review, significant issues within the country’s cash infrastructure remain.

The review was set up by ATM network provider Link to help understand how consumers use cash and how their requirements to access physical money will change over the next five to 15 years.

 

Source: https://uk.finance.yahoo.com/news/uk-cash-system-is-at-risk-of-collapse-100821647.html?guccounter=1&guce_referrer=aHR0cHM6Ly9uZXdzLmdvb2dsZS5jb20v&guce_referrer_sig=AQAAAFaPwxCVK4k3z-9fkowPJ57zWEIuKlKGp_-JVo928x4pfzA37j_-hSsJN1ZLCLE1S4sEON0KK2DkCs92bvIdwt2Y4mkUDQHEvQV9Fh7HoVb7aVi0A7xN71BRAwvOxrbSIgppswfPe0h8d_qYUK-NXS668LN9Gc4IV2j46Od3uaSr

Wednesday, 19 February 2020 15:41

Fuel prices push UK inflation to six-month high

UK inflation in January rose to a six-month high as petrol and house prices rose, official figures show.

The Consumer Prices Index (CPI) stood at 1.8% last month, up from 1.3% in December, the Office for National Statistics said.

"The rise in inflation is largely the result of higher prices at the pump and airfares falling by less than a year ago," the ONS said.

The rise is ahead of economists' CPI forecast of 1.6% in January.

CPI remains below the Bank of England's 2% target for inflation. Wednesday's inflation data pushed the value of the pound above $1.30. Versus the euro, the pound had started the day down 0.25% but rose back to trade flat against the single currency.

However, some analysts said that the new figures were unlikely to "move the dial" on the central bank's next decision on interest rates in March.

 

Source: https://www.bbc.co.uk/news/business-51557550

Wednesday, 05 February 2020 11:59

Payroll: What we know for 2020/21

It’s been a tense few weeks for payroll software developers and tax agents who are trying to prepare employers for the new tax year. The software development cycle for the last 18 years has worked on the basis of having key pieces of tax information announced as part of an autumn statement, rather than being left to a spring budget.

This year was very different. When parliament was dissolved in November 2019, the civil service went into a period of election purdah until mid-December which prevented any discussions about next tax year taking place with policymakers.

If we’d had an early February budget, the timetable for revising software would’ve been tight, but just about deliverable. However, a Budget on the 11 March presents a problem.

 

 

Source: https://www.accountingweb.co.uk/tax/hmrc-policy/payroll-what-we-know-for-202021?utm_medium=email&utm_campaign=AWUKPOW050220&utm_content=AWUKPOW050220+CID_1b1c3d68e35b3689bdc21d6ab20be165&utm_source=internal_cm&utm_term=Read%20more

Britain's blue-chip benchmark index finished down around 95 points lower, or 1.3%, at 7,286, going below 7,300 for the first time in seven weeks. FTSE 100 index closed decidedly in the red on Friday as January ended on a sour note and health fears continue to weigh on global markets.

Britain's blue-chip benchmark index finished down around 95 points lower, or 1.3%, at 7,286, going below 7,300 for the first time in seven weeks. Over the week as a whole, Footsie lost 3.9%.

The FTSE 250 shed over 148 points on the day to close at 21,143.  Over on Wall Street, the Dow Jones lost 382 points, while the S&P 500 shed around 40 points and the Nasdaq plunged 86 points.

Chris Beauchamp,  chief market analyst at online trader IG noted that few people would have suggested that  a ‘major virus outbreak’ would have been seen as a big risk for markets in 2020.

 

source: https://www.proactiveinvestors.co.uk/companies/news/911933/ftse-100-closes-down-13-as-january-ends-on-sour-note-911933.html

 

There are a few special days in my career that stand out because of the historical events I was privileged to live through and comment on – memorialize, perhaps – to my colleagues. The two that stand out most:  I remember the morning meeting I gave on 10 November 1989, the day after the Berlin Wall fell. Luckily in those pre-internet days I had a copy of Trotsky’s The Russian Revolution and so could get the quote right:  You are bankrupt, your role in history is played out. Go out where you belong – onto the dustheap of history. I remember the day Barack Obama was elected; choking back emotion, I quoted to my colleagues the words of Martin Luther King:  "I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character.” I thought Obama’s election signaled that that day had arrived in the US. How wrong I was. 

But what am I to say to my colleagues today, Brexit Day? A day nearly as heavy with historical import, but for me, totally bereft of the hope and vision of a new, better future that these other landmark dates were imbued with. On the contrary, this seems to me to be a country rejecting the future and turning to a mythical past, and in the process committing economic and political suicide:  the impoverishment of the people leading, most likely, to the dissolution of the centuries-old alliance among the several nations of the United Kingdom. This time the map is being redrawn out of fear, not out of hope.

 

 

Source: https://www.nasdaq.com/articles/bye-bye-britain%3A-pain-ahead-for-the-uk-and-gbp-2020-01-31

 

 

 

LONDON (Reuters) - British Prime Minister Boris Johnson and U.S. President Donald Trump said they looked forward to continued close cooperation and the negotiation of an “ambitious free trade agreement” during a phone call on Monday, Johnson’s Downing Street office said.

“The prime minister spoke with President Trump, who congratulated him on the result of the general election,” a Downing Street spokesman said in a statement.

“They discussed the huge importance of the relationship between the UK and U.S., and looked forward to continued close cooperation on issues such as security and trade, including the negotiation of an ambitious free trade agreement.”

 

 

source: https://uk.reuters.com/article/uk-britain-eu-trump/johnson-trump-look-forward-to-ambitious-trade-agreement-downing-street-idUKKBN1YK1HV

 

 

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