The Unit of all Tax Departments

2006: The Unit – David Mamet

The Mega Tax Unit

The wealthy need to make sure that their tax records are right up to date. HMRC are now focused on the wealthiest 500,000 people in Britain. They even have an “Affluent Unit” which was set up a year ago but have recently reduced the “ticket price” from wealth of £2.5m+ to £1m+. Mind you this is not high net worth according to HMRC who have the department of departments, the ingeniously named “High Net Worth Unit” which looks at those with wealth of £20m or more. Since it was set up in 2009, it claims to have collected £500m in extra tax – rather more than even HMRC thought they would get. This is the unit of all tax departments!

One Hundred Elite Taxmen

Its a fairly “big” job for the HMRC, so to help the Coalition has arranged for another 100 inspectors and specialists to be recruited. I dare say that they will command quite significant salaries for their expertise, which may help account for the cost of the projects at £917m… with the expectation that this will achieve additional tax collections of £7bn by 2014/15.

Focus on the right target?

The HMRC (Gareth Hills the ARC President to be precise) seems keen to suggest that each inspector generates 30 times their cost, which is surely a pretty good return if its true. There is some considerable debate about where to focus resources and whether specific departments are necessary, perhaps merely creating bureaucracy. Mike Flemming, tax Director at Straughans is reported as saying that HMRC should focus on £22.3bn in lost taxes due to VAT fraud and incorrect Self-Assessment tax returns – which covers pretty much the rest of the population. So be warned, getting your tax return in on time is important, but not as important as getting it right.

The Unit of all Tax Departments2023-12-01T12:22:54+00:00

Has Clegg implied the means-tested State pension?

1938: Test Pilot – Fleming

A Means Tested State Pension?

The LibDem conference concluded with Nick Clegg’s speech. You may have seen him on the news last night talking about cutting some of the free benefits to rich pensioners. He said “it is difficult to explain why Alan Sugar’s free bus pass should be protected when housing benefit is being cut”. Now I don’t want to get too political, but I doubt that Alan Sugar uses the bus and if he has been sent a free pass, I suspect it is in the bin and never been used (wild speculation on my part).

Alan Sugar’s Bus Pass

One would have thought it would be wiser to ask people to apply – hang on a moment, according to the DirectGov website you only get a free bus pass when you apply for one and the same is true for the London freedom pass. So I very much doubt that Lord Sugar has ever applied, which begs the question what on earth does Mr Clegg mean? Perhaps he is suggesting that there should be no free bus passes? let’s face it, anyone with a car is less likely to apply and they are only available to people with disabilities or of State pension age with modest to low incomes. I’ll take a wild guess that Mr Clegg does not wish to alienate these groups.

Winter Fuel Allowance

So what of the Winter fuel allowance? to which he also referred  well this is paid to households that are in receipt of a State pension. It isn’t really claimed, it’s paid as a bit extra, with a couple of exceptions – those claiming child benefit, council tax benefit or housing benefit all need to claim it. It’s worth £100-£300 dependant upon age and the number of people that you live with.

Reading between the lines

I’m therefore perplexed at what he is really meaning. It occurs to me that this is merely a warming up of a notion that may gain momentum. The notion being that some people are wealthy enough not to need State support or benefits. If I might suggest this would possibly include the State Pension, which is probably the only “benefit” that most “wealthy” retired people could receive. There is probably some mileage in this, after all a similar thing has happened to child benefit. However, if this were to become practice, it would mean that the State Pension would become means-tested, which if the case begs the question of why pay national insurance? and where is the line drawn? Whilst I’m not wishing to stir the pot (well, maybe a little) I suspect that Mr Clegg has inadvertently indicated the way in which his or the Coalition Government’s thinking may be going. Any thoughts? How about those with final salary pensions like the NHS paying a pension of over £35,000 a year? how much “guaranteed” income do you think might render you ineligible for a State Pension if it became means-tested?

Has Clegg implied the means-tested State pension?2023-12-01T12:22:54+00:00

Lawyers Expect A Close Shave With HMRC

2011: The Lincoln Lawyer – Furman
It may be many years since the UK launched a proper taskforce, but HMRC is effectively going out all guns blazing in its campaign for collecting owed taxes. At the moment they are focusing on Lawyers . It basically works like this, HMRC know roughly how many clients each practice has, therefore it can look at average revenues and spot those that look a little bit low on their declared income. Previously HMRC has attacked Doctors, Dentists, Tutors and Coaches, however Lawyers are the first “high risk” group being attacked by the taskforce.
Other “high risk” groups include the hair and beauty trade in the North East, thought to owe around £3.5m in tax. Restaurants in the South East and Solent are also under review (£2.5m), the Scottish motor trade (£3m) and the grocery and retail trade (£7m). There are now over 30 HMRC Taskforces in operation, all launched since May 2011.
There are various ways to legitimately reduce your income tax. The most obvious being to make pension contributions, which attract tax relief at your highest rate of tax. Charitable Giving is also a way of reducing tax burdens and of course means that your money goes to a source that you are concerned about. If you are need assistance do get in touch, otherwise perhaps some of the no win, no fee cases may be concluding earlier.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Lawyers Expect A Close Shave With HMRC2023-12-01T12:22:53+00:00

Party for £4billion?

1993: The Last Party – Levin
You will be aware that the LibDems are in Brighton for their conference. Today Danny Alexander is expected to announce that the Coalition Government are making progress towards their pledges to clamp down on tax dodgers. He is expected to announce that £4bn has been recovered this year, which is on the way to the £9bn target by 2015. Whilst this is good news, I’m not entirely sure that doing the job of collecting owed taxes is something to shout about – anymore than one would praise a ticket inspector for checking people had tickets.
The LibDems also seem to be discussing and widely supporting the break up of RBS and Lloyds Bank, two of our national banks. I doubt that many would disagree that it would make sense to use public banks to fund the economy, however the detail of such agreements is rather vital. Simply taking over other debts so that businesses can borrow from the usual culprits again is little more than a game of pass the parcel. As with most political conferences, there’s a lot of razzle and dazzle – no doubt over the next 2 months we shall witness a pretty grim display of this at its worst in America. Hopefully amidst all the glitz and bunting are some good ideas about how some of the world’s economic problems will be tackled positively. Something that we look to politicians to take the lead on implementing, but at the same time aware that ultimately we are responsible for our own actions and need to play our part in economic life.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Party for £4billion?2023-12-01T12:22:53+00:00

Cash ISA Rates

Time to update you on some of the top rates of interest for deposit accounts. Remember that the FSCS (compensation scheme) only covers up to £85,000. This is not advice, but a list of top rates.
2007: Economic Theory – Becker
Instant Access (taxable)
Building Society: Newcastle 2.35%
Cash ISA Fixed Rate (not taxable)
Building Society: Leek United 3.50% 3 years
Cash ISA Variable Rate (not taxable)
Building Society: Newcastle 2.35%
UK National Economy
Inflation – RPI measure: 2.90%
Inflation – CPI measure: 2.50%
Bank of England Base Rate: 0.50% 
In terms of shared banking licenses (and therefore limited FSCS protection), Virgin Money share a license with Northern Rock and Halifax is part of RBS. All of the Building Societies listed above currently have their own separate licenses. Sainsbury’s Bank also holds a separate license.
As the above figures are some of the “best rates” it is clear that cash is rarely keeping pace with inflation, making life harder for savers as the spending value of every pound reduces.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Cash ISA Rates2023-12-01T12:22:52+00:00

Hoping For Long Term Results

2012: Hope Springs – Frankel
I’m a fan of Meryl Streep – but her latest film “Hope Springs” is not as advertised (in my humble opinion). The radio and tv adverts suggest that this is a hilarious comedy. Whilst it has its comedic moments, this is actually a story of an empty nest couple who have a marriage without intimacy. Weathered by the years it is a well observed, but all-too sugary unveiling of lives built upon functionality, which becomes dysfunctional. This film lands some tough punches, but ducks the really big questions.
At the weekend I was at a family celebration for a 50th wedding anniversary and the week before a 25th. We all probably have a reaction to these “landmarks” however whilst I am very much an advocate that relationships must be worked at in order to thrive, (often the work is hard) there is a degree to which there is a portion of luck involved. For starters, that both desire to want to work at the relationship and perhaps that time is not cut short by events way beyond our control. Luck, it might therefore be acknowledged, however “small” is perhaps a vital ingredient. Turning this to the world of investment, I’m not a fan of “luck” yet often those that have the best stories to tell were frankly, lucky – the sort of luck that does not get repeated regularly. Fund Managers work to get their research to a level where one would observe that perhaps investing is nothing more than a science, yet the truth is that the research is little more than a basis for decisions, not a crystal ball. Interpretation is an art and sometimes they get lucky and sometimes they don’t. Many of them are bright and skilled at what they do, but over the longer term, the “luck” tends to average out as performance reverts to “average”.  This is why, my clients are encouraged to take a long-term view of investments, we don’t think that its possible to consistently beat the market (unless you cheat or the market is rigged). As with relationships, the quality is in the effort made to gain understanding, to meet expectations and work together for the same ends.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Hoping For Long Term Results2023-12-01T12:22:51+00:00

Dictum Meum Pactum

1953: Latin Lovers – LeRoy
I have to admit that I often feel “plebeian” in my dealings with my Bank. Whilst I know that Banks are massive impersonal organisations, the promise (and payment) for a personal service differs considerably in understanding between my Bank and I. I tend to expect personal to mean, handled by a person – with whom there is a relationship that is based upon understanding beyond box ticking, to my Bank it seems that whilst this is their claim, every phone number provided is an automated call centre with a rabbit warren of PIN, alphanumeric options and “let me put you through to a different department” responses. Despite the heavy rain and falling temperature, my office reached boiling point yet again following another lengthy blow by blow regurgitation of my problem and attempt to find solutions. It is with a degree of sadness that I find much fault in my Bank. As with many Banks they seem to display an attitude where customers serve them not the other way around.
It is amusing to note the folly of the Conservative Chief Whip over the weekend. The truth is plain for those that wish to see it, as sad as it is. The depressing state of  those “in power” are giving “leadership” a very bad name and displaying none (or very few) of the necessary qualities, choosing instead to apologise for things they did not do and ignore the things they did. Many of our leaders should win gold medals for their gymnastic agility with meaning-less words. I was at Public School too, Prep School in particular was a place where the term “pleb” was used in a derogatory fashion (by certain staff and pupils) perhaps fed by a schoolboy’s poor grasp of very limited Latin, which otherwise was a struggle. Thankfully I know better, (and was reasonably ok with my Latin) because I grew up and don’t spend time (as far as I’m aware) with people that have such attitudes. Radio 4 had an interesting insight into the term “pleb”. However, perhaps I should be less quick to judge. I can be demanding and rather impatient when things don’t go my way, most obviously displayed by bad banking and bad driving. Holding my tongue is a life lesson that I know I need to work on too, particularly when it comes to reading some of the nonsense in the financial pages. So sincere apologies to anyone at my Bank that caught my ire and those drivers that I accuse of cutting their license off a packet of cereal. mea culpa. As my Latin Master once wrote “must try harder”.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Dictum Meum Pactum2023-12-01T12:22:51+00:00

Fudging Independent Terms

2011: Miss Representation – Newsom
Financial advice is either independent or it isn’t, by which the new terminology is “restricted”. Independent is not fifty shades of grey, you cannot be a little bit pregnant or a little bit dead, you cannot be a little bit independent. I can certainly agree that some of the 2013 restricted advisers may be very good indeed, after all every adviser has to achieve a minimum standard of qualifications. However, it seems a little odd that one might chose to be “restricted” as opposed to independent in my opinion. Clients admittedly may not always mention the importance of independence, but frankly I believe they simply expect it. Those that chose to seek advice from a bank or insurance company really should be aware that the advice they receive is very limited indeed, some people still don’t recognise this, but then they are probably not the sort of people that really understand the importance of good financial planning. The lack of knowledge on this issue is due to a failure on the part of the regulator, media, government, financial services generally and quite obviously financial advisers and those that claim to represent them.
Today the Association of Independent Financial Advisers (AIFA) has announced that they intend to change their name to Association of Professional Financial Advisers. This signals their clear intention to “represent” both independent and restricted advisers. Sadly, I don’t feel that they have done a very good job to date representing IFAs so I’m sending off my application to the IFA Centre, to have the case for independent advice represented at Government, Regulator and European levels. I believe, like the IFA Centre that clients want and deserve proper independent financial advice, I would go a step further and suggest they they also want and deserve proper financial planning – which is in my view the only good way to make any financial plan meaningful.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Fudging Independent Terms2023-12-01T12:22:50+00:00

Independent Thinking – Singing It Loudly

1946: Stand Up And Sing – Rogell
Another day, another trip into the City. This time I was attending an event about the new world that is due to start from January, its a new world to those within financial services, but of course probably not to you. In a nutshell, there was a very good presentation by Gillian Cardy about why independent financial advisers ought to remain independent. Somewhat preaching to the choir you would think, but alas many firms feel so threatened by the new rules, that they would rather limit their options (and those of their clients) to a much reduced range. This will deem them as “restricted advisers” which I dare say will not be explained as well as it ought to be (the way the FSA, soon to be FCA require).
As I hope is obvious, I believe very clearly that independent financial advice is the best sort of financial advice. I’m not restricted to only advising on some products, but on pretty much anything. The important and rather obvious point is that being independent, I have access to the whole of the market and represent my clients best interests. As we have always worked on a fee basis we can also clearly demonstrate that there is no bias in selecting any product or provider – we get paid the same whatever is selected. Certainly an independent financial adviser has more research to do and arguably needs more skill and knowledge, but as far as I’m concerned we have been operating under the new 2013 rules since 1999. Our clients face little real change as a result. Our fees are properly and fairly priced. The main changes that we face are the improvements to technology and therefore we can constantly improve our services. So I’m expecting next year to be better than ever for our clients and I’m expecting to continue providing a great service, hoping that they will sing our praises.
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Independent Thinking – Singing It Loudly2023-12-01T12:22:50+00:00

Back to the Classroom – Financial Education

2009: An Education – Scherfig
I’m feeling somewhat older at the moment. I took my daughter for her first day at University on Monday. Home is quieter and it will take some getting used to. As a father, I wonder if I have prepared her well enough for the new adult responsibilities which include paying bills, too much assistance and learning is very much impaired, too little and feelings of being overwhelmed can quickly stir. Finding the right balance of parental input gets a little harder each year as the process of “letting go” is of as much value to the parent as it is to the child – or at least, that’s my take on it.
Harking back to my own student days, I know is many years ago, but it doesn’t seem that long ago in some senses. At that point, a credit record was not a topic of conversation. The prospect of running out of money meant not eating (or drinking) so careful balancing of accounts needed to happen. Today, the standard student bank account comes with an overdraft and one that increases each term. This is of course is the age of credit, but if ever there was a word more misappropriate, then I have yet to learn of it. Many students starting their first year this term will be playing the game of catch-up, it is one that they may not ever “win”. Contrary to initial statements, pretty much all Universities charge £8,000+ or more per year. Student “digs” are comfortably £3,500+ for starters, then its the food and living student life – so how much should a student be able to live on each week? For many University will be an economic decision, not merely an academic one. However in a world where jobs are scarce, having up to date relevant skills is vital and I suspect that University is possibly not really an option, but a necessity.
I have met hundreds of people over the years who had a very poor financial education and the consequences of this can have a long-term impact on their ability to make good financial decisions. A large part of the missing education is relatively straight-forward, but can feel like learning a foreign language. A real problem when it comes to money matters, is frankly one of trust. Rarely is it wise to completely trust someone with whom you have a “business arrangement” – perhaps a high level of trust yes, (even very high) but you should always leave room for some doubt (yes even with me). Motivation has a direct link with trust. So being clear about what it is that you are paying for is important. Financial services is full of the wrong motivations. Better remuneration for bigger returns, paid to sell products and so on. Trust is a theme that we tend to return to regularly throughout life, getting better at trusting requires a gradual letting go – much like being a parent and seeing the child through to adulthood. There is good experience and bad experience, both are useful. There isn’t a perfect University course, politician, doctor, accountant etc any more than there is a perfect financial adviser. However, there is a scale. I would suggest that the transparency of the relationship is a very helpful starting point. 
We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting
Back to the Classroom – Financial Education2023-12-01T12:22:49+00:00
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