Do they know it’s Christmas? Thousands will file tax returns on Christmas Day

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Over 2,000 business owners submitted Self Assessment tax returns to HMRC on Christmas Day last year

More than 2,000 people spent Christmas Day submitting their online tax returns to HM Revenue and Customs last year.

A total of number of 2,044 business owners proved the adage that you never get a day off when you run your own business, as they spent the holiday finishing the essential admin last Christmas Day. Last year’s figures were a record, up 13% from the previous year.

Traditionally the busiest filing time on Christmas Day is just before lunch, from midday to 1pm.

For anyone missing the 31st January deadline, HMRC will automatically issue a £100 penalty, and will charge interest on any unpaid tax. You may also be able to ask HMRC to waive your penalty, if you have what they consider a “reasonable excuse” for not filing your return.

Meanwhile, 600 people rang the new year in by submitting their tax return between midnight and 10am on New Year’s Day.

 

 

Latest survey predicts strong labour market in 2017

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A strong labour market will see job growth continue to rise in 2017, according to the latest CBI/Pertemps Network Group Employment Trends Survey

The underlying strengths of the UK’s labour market will see jobs growth continue into 2017, according to the latest CBI/Pertemps Network Group Employment Trends Survey.

The annual survey – in its nineteenth year, with 353 respondents employing nearly 1.2 million people – found that four in ten (41%) firms across the UK will grow their workforce in the year ahead.  For the fourth year running, the survey shows that growth in permanent job opportunities will outstrip temporary recruitment.

The survey, carried out between August and October 2016, found that while the pace has slowed by comparison to last year’s survey, the positive balance of firms expecting to add employees over those expecting to shed jobs stands at +28%. This continues the optimistic trend we have seen every year since 2011.

Shaken confidence

However, uncertainty about the UK’s future relationship with the EU has shaken overall business confidence in the labour market. Overall, the balance of respondents expecting the UK to be a more attractive place to employ people in the next five years has flipped from +16% in our 2015 survey to -21% in the year’s results.

Josh Hardie, CBI Deputy-Director General, said: “With record employment levels, more people than ever are now in work and the strengths of the UK labour market look set to yield positive results over the course of 2017.

“Businesses are 100% committed to making the best of Brexit. However, this year’s survey does show a greater sense of concern about the UK’s long-term attractiveness as a place to create jobs. Getting our industrial strategy right and understanding what the UK’s future relationship with the EU will be, will help ensure that this worry does not negatively impact the future performance of the labour market.

“The Government should build on the positive moves it has already made to dispel uncertainty by drawing up plans for a smooth transition, giving firms both the time to adapt to new regulations and the confidence to invest beyond 2019.”

Carmen Watson, chair of Pertemps Network Group, said: “2016 may have been a year of uncertainty for businesses but what we are seeing, looking ahead to 2017, is renewed optimism with employers continuing to invest in their workforces leading to jobs growth across the UK.

“It appears also from the survey that the majority of businesses are now working hard to push diversity and inclusivity to the fore, as it is proven to bring benefits including increased talent and improved attraction and retention levels. However, skills gaps remain a concern for employers as having the right people with the right skills is crucial for any organisation’s performance.”

Other highlights from the survey include:
  • 33% of survey respondents expect to create permanent positions, while 14% expect lower, giving a balance of +19%
  • 14% of companies expect to create temporary roles, while 12% expect a reduction in roles, giving a balance of balance, +2%
  • 30% of firms expect to create apprenticeship positions, while 4% expect lower levels of recruitment, giving a balance of +26%
  • 20% expect to expand graduate roles, with 4% plan to see fewer roles, giving a balance of +16% – the same balance as 2015
  • The majority of firms (77%) report positive employee relations and a similar proportion (76%) anticipate this continuing into 2017
  • Businesses are aware of the value of employee engagement, pointing to benefits including improved productivity and performance (73%), increased customer and client satisfaction (57%) and improved employee retention (44%)
  • In the coming year, the top workforce priorities for businesses are achieving and maintaining high levels of employee engagement (48%), retaining talent (41%) and improving leadership skills (37%)
  • Survey respondents emphasised that the future migration system must be responsive to economic need (45%) and provide access to both labour (46%) and skills (40%).
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Murdoch Sky takeover gains momentum

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Deal agreed by 21st Century Fox valued at £11.7bn

Media mogul Rupert Murdoch’s bid to take over Sky via his 21st Century Fox has reached another milestone, with terms being agreed by both sides.

The proposed deal, if completed, will see 21st Century Fox offering £10.75 per share to Sky shareholders, in an acquisition that is expected to complete by the end of 2017 according to the American company’s Nasdaq statement.

“As the founding shareholder of Sky, we are proud to have participated in its growth and development,” 21st Century Fox said. “The strategic rationale for this combination is clear. It creates a global leader in content creation and distribution, enhances our sports and entertainment scale, and gives us unique and leading direct-to-consumer capabilities and technologies. It adds the strength of the Sky brand to our portfolio, including the Fox, National Geographic and Star brands.”

The deal is valued at £11.7bn in order to acquire the 61% of Sky not yet owned by 21st Century Fox. It has already sparked intense political debate, five years on from the phone-hacking scandal that ended Murdoch’s previous attempt to fully acquire the broadcaster.

Sky’s deputy chairman, Martin Gilbert, added detail to the proposal. “The Independent Committee, which was formed with the express purpose of protecting independent shareholders’ interests in relation to the proposal from 21st Century Fox, has given full consideration to the fundamental value and prospects for the Sky Group,” he explained.

“While the Independent Committee remains confident in Sky’s long-term prospects, as laid out in detail at our recent investor day in October, we, supported by our advisers, believe 21st Century Fox’s offer at a 40% premium to the undisturbed share price will accelerate and de-risk the delivery of future value for all Sky Shareholders. As a result, the Independent Committee unanimously agreed that we have a proposal that we can put to Sky shareholders and recommend.

“The Independent Committee also notes 21st Century Fox’s track record in growing businesses and its ability to continue the development of Sky across Europe, in a world where entertainment and distribution are converging. 21st Century Fox’s ownership will support the delivery of Sky’s strategy and long-term growth, ensuring that it remains at the forefront of Europe’s creative industries.”

FCA launches consultation on changes to its FSCS rules

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FCA invites discussion on future funding of the FSCS scheme

The Financial Conduct Authority (FCA) has today announced that it is inviting views on the future funding of the Financial Services Compensation Scheme (FSCS) and has also launched a consultation on a number of specific changes to its scheme rules.

The FSCS is the UK’s statutory compensation scheme of last resort, which can step in when an authorised financial services firm is unable, or likely to be unable, to pay claims against it. Firms from across the financial services industry pay levies to fund both the FSCS’s operating costs and the compensation it pays out.

The rules for the FSCS were last reviewed in March 2013 when the Financial Services Authority concluded a review of the scheme’s funding and published final rules.  Since then, the scale and impact of FSCS levies has risen sharply for some firms.

Christopher Woolard, Executive Director of Strategy and Competition at the FCA said:

“The Financial Services Compensation Scheme plays a vital role in ensuring consumer confidence in financial services.

“We want to ensure protection for consumers and fairness for firms that pay for the compensation. We want to have a full debate with all interested stakeholders and this paper sets out the range of fundamental issues we want to discuss.”

Invitation for responses

The FCA is inviting responses on a number of options for changing both the funding of the FSCS and the coverage it provides to consumers. These options include:

  • asking for feedback on the professional indemnity insurance (PII) market and the coverage that it provides – the FCA is considering proposals to make PII more effective through the introduction of mandatory terms
  • introducing product provider contributions towards intermediation claims
  • changing the FSCS funding classes for intermediation activities
  • updating limits on consumer coverage in light of the pension freedoms
  • exploring the potential for FSCS levies to better reflect the risks posed by particular practices.
New proposals

The FCA is also consulting on a number of specific proposals to change rules affecting the scope and operation of FSCS funding, including:

  • amending payment arrangements so that firms may be asked to pay a proportion of the levy on account
  • introducing FSCS coverage for debt management firms
  • extending coverage in respect of fund management
  • applying FSCS protection to advice and intermediation of structured deposits
  • ensuring that FCA rules include Lloyd’s of London appropriately, in circumstances where they could be called on to contribute.

The FCA is asking for responses to its Consultation Paper by 31 March 2017 before publishing final rules and a further Consultation Paper on proposed rule changes in Autumn 2017.

UK and China agree long-term ambitions for education plans

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UK-China agreement will see an upturn for both countries in basic education; higher education, training and assessment

The UK Secretary of State for Education, the Rt Hon Justine Greening MP, has agreed a joint ‘Action Plan’ on UK-China education collaboration with her counterpart Mr Chen Baosheng, China’s Minister of Education, at the ninth annual UK-China Education Summit in China, convened jointly by the British Council, the Department of Education, and China’s Ministry of Education.

The Action Plan sets out the priority areas of UK-China education collaboration beyond 2016 with the objective of supporting a golden era in UK-China relations.

The agreement will see both countries working together across basic education; higher education, including quality assurance; technical and professional education and training; sports education and training; language teaching and assessment; and two-way exchanges among students and education practitioners.

Examples of work that will be pursued in these areas include:

  • boosting business-education links to accelerate the development of skills and qualifications in priority industry sectors;
  • increasing collaboration on innovation and entrepreneurship in higher education, including the creation of subject excellence clusters and regional partnerships;
  • working together on school curriculum development, such as by supporting and placing language assistants in schools to support the learning of Chinese Mandarin in the UK and English in China.

Furthermore, it was agreed to continue the UK-China Mathematics Teacher Exchange Programme for a further two years. This will see up to 140 maths teachers from England spending time in Shanghai to support their professional development and the translation of Shanghai’s high-quality approach to mathematics teaching into a meaningful model for schools in England.

Various other agreements were signed during the two-day visit, representing both countries’ commitment to expanding collaboration across higher and school education, including languages, and to working closely together in supporting student mobility in both directions.

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Boom year for the most British of drinks

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Gin sales in the UK break the £1bn mark for the first time ever

Gin has seen a resurgence as the trendy tipple of choice recently and 2016 has so far been a record year for the aromatic spirit. According to the Wine and Spirit Trade Association’s latest Market Report gin sales in pubs, bars and restaurants (on trade) in 12 months (to 1/10/16) went up +19%, on the same period last year, worth £619m.

The amount of gin sold in our shops, supermarkets and off licences (off trade) which in 12 months (to 5/11/16)  went up +13%, worth £437m.

All in all gin sales broke the £1bn sales mark in the on-and-off trade for the first time ever in in the UK in 2016, 6 months ahead of forecasts, making it a record breaking year for gin.

For six consecutive quarters, on trade sales of gin have seen double digit growth, outperforming every other spirits category; 283,000 hectolitres, the equivalent of 40 million bottles, of gin have been sold in the on and off trade in UK in the last twelve months which works out as 1.12bn gin and tonics.

Quality over quantity

However government data shows that UK alcohol consumption per capita has dropped by a fifth over the last ten years. It appears that even though the market is shrinking, drinkers are choosing more premium products, like gin. Sales of sparkling wines including Champagne, was the next biggest growth sector, with sales up 12%.

Overall, the wider British alcohol market rose 2% to £40bn. Following the cut in spirits duty in the 2015 budget, spirits duty income increased on the previous year by £125m (+4.1%) from April 2015 to March 2016 inclusive.

Export success

British gin has also seen a huge export growth; 3 out of every 4 bottles of gin imported around the world are from the UK. British gin is now sold overseas in 139 countries around the world with America, Canada, Spain and Germany buying the most. British gin exports to the USA have risen by a staggering 553% in the last decade with £159m worth of British gin sold to the Americans in 2015.

Whether this growth can be sustained is another matter – every trend reaches its peak and now rum looks set to be the next contender for hip tipple of choice.

Is the FTSE set for a tumble?

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Analysts predict bullish-to-bearish market reversal

While European stocks are enjoying sharp gains, boosted by the auto, mining and banking industries and optimism that the European Central Bank will extend its stimulus programme. However there are fears that the FTSE 100 Index could fall by as much as 10% after this year’s impressive benchmark performance.

Since June there has been a marked pattern, known by technical analysts as a “head and shoulders” pattern; this is normally a precursor to a bullish-to-bearish market trend reversal.

After near-record close in October, some analysts are predicting a fall to below 6,650, to as low as 6,164, Francis Hunt, known as The Market Sniper, told Bloomberg. He has previously accurately predicted the crude prices slump in 2014 and the failure of the eur0-Swiss franc floor in 2015.

“We have a head-and-shoulders pattern that is well-formed, showing a degree of exhaustion,” Hunt told Bloomberg. “All we need is a sustained move below the neckline — the 6,650 level — for a final confirmation. That’s when people should short.”

  • The FTSE 100 traded at 6,871.13 as of 10:43 a.m. in London. Hunt predicts it will breach the 6,650 level in the early weeks of 2017.
  • Cyclical shares, including banks and commodity producers that are among the FTSE 100’s biggest members, are “at risk of taking a breather,” UBS Group AG’s technical analysts including Michael Riesner wrote in a note Tuesday.
  • Weaker sterling and increased stimulus from the Bank of England after the U.K.’s secession vote boosted exporters in the months after Brexit. The FTSE 100 is up 10 percent this year, outperforming all western-European benchmarks except Norway’s.
  • “The pound is coming back up, which makes things pretty difficult for the FTSE 100,” said Andrea Tueni, a trader at Saxo Bank in Paris. “It’s trading not far from the head-and-shoulders neckline. Crossing it could spark a selloff.”
  • Sterling hit a two-month high on Tuesday, following its first monthly gain since April.

Source: Bloomberg

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The latest Brexit shock in FTSE reshuffle

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Building supply company relegated from FTSE after dramatic share price drop

The UK’s largest building supply company has fallen foul of Brexit and is to leave the FTSE 100. Travis Perkins is the second company to be demoted from the index, in the final reshuffle of the year. House building company Berkeley Group lost their footing in the September revamp.

The builder’s merchant had issued a profit warning last month and predicted a tough trading backdrop for next year, in light of a 30% share price drop since the June referendum. 

Polymetal International also moves off the listing after gold fell by 8% post-US elections. The reshuffle sees Irish paper-packaging giant Smurfit Kappa and healthcare company ConvaTec join the listing.

Russ Mould, ofonline investment platform AJ Bell told The Telegraph: “Smurfit Kappa’s promotion represents a remarkable turnaround in fortunes, as the shares collapsed following its 2007 flotation to barely 140p in 2009, weighed down by the recession and hefty debts.”