| UPDATED: 18:45, Tue, Feb 2, 2021
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The UK is headed towards a double-dip recession according to reports as the impact of the pandemic and lockdown measures takes its toll. The Department of Health unveiled figures last week that showed cases had dropped by two thirds in the UK since the first week of January, but the economy continues to suffer. The services sector – accounting for 80 percent of the economy – has seen its activity drop from 49.4 in December to 38.8 in January, as highlighted by the IHS Markit/Cips purchasing managers index. Anything below 50 percent in
Share your views on HMRC’s use of third-party data 2 February 2021: The Office of Tax Simplification and HMRC are considering how data from third parties could reduce the administrative burden on taxpayers. ICAEW’s Tax Faculty wants to hear members’ views.
On 27 January, the Office of Tax Simplification (OTS) launched a call for evidence on third-party data provided to HMRC, as part of its review into making tax easier for people through smarter use of such data.
The use of third-party data also forms part of HMRC’s ongoing tax administration framework review, and the Tax Faculty is urging members to share their views to support ICAEW’s engagement with the OTS and HMRC.
Meanwhile advisers are seeing clients actively discussing using more of their allowances.
Plan Money director Peter Chadborn says: “We have experienced decumulation clients, particularly those that make ad-hoc withdrawals, saying they don’t need to make withdrawals for the time being.
“We are now noticing accumulation clients starting to ask questions of what to do with surplus capital so there are more Isa allowances getting utilised.
“I’ve also started to notice an increased interest in gifting with older generations with surplus capital keen on helping younger family members who may be struggling by paying a chunk off their mortgage, or something similar, so it is definitely a trend.”
More Isa allowances are being utilised, while older generations show greater interest in gifting
The pandemic has brought huge financial challenges for many individuals and savers, but it has also dramatically boosted savings in the UK.
The savings ratio, often cited as worryingly low over the past decade, has soared and some advisers are adapting their advice accordingly.
Households collectively saved around £17.5bn ($24bn, €20bn) a month in the first lockdown, a similar sum in the second and it seems very likely they are doing so again.
The savings ratio hit 29.1% in the second quarter, a record, and it is expected to be around 15% for the year. Total additional savings in 2020 were around £120bn.
Don t be distracted by property levy rumours – the dreaded wealth tax is far more likely
We already know the Government is looking at raising capital gains and taxing wealth
Another week, another round of speculation about the possible introduction of a new tax to foot the bulging coronavirus bill.
The latest spot of kite flying from Treasury mandarins takes the form of an entirely new property levy. Apparently being considered by Rishi Sunak ahead of the crucial March 3 Budget, this would replace both council tax – still, incredibly, pegged to 1991 housing values – and stamp duty, currently subject to a “holiday” on properties up to £500,000, but due to expire on March 31.